Will travel industry be affected by recession?

A global recession will impact the entire Travel & Tourism sector, despite the robustness that it has shown in past years. There are many reasons to expect that demand for all kinds of travel will decline in the coming years.



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Certainly, it's a sector that has historically been hit hard during recessions. During the last major global recession (that wasn't caused by a global pandemic that shut down travel altogether) in 2008, air travel dropped off by around one-fifth, the most it has since records have been kept.

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Indeed, the World Travel & Tourism Council (WTTC) forecasts that the global travel and tourism sector will reach US$9.5 trillion in 2023 — just 5% below 2019 pre-pandemic levels. The positive summer travel outlook is echoed by data from J.P. Morgan Research.

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This is the reason why hotels have fewer customers when a recession takes place. During the recession, a lot of the hotel's resources get wasted. Like room ACs, electricity, rent, and many others. The hotel industry during recession, faces difficulty in managing their expenses.

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Higher interest rates that often coincide with the early stages of a recession provide an advantage to savers, while lower interest rates moving out of a recession can benefit homebuyers. Investors may be able to find bargains on assets that have decreased in price during a recession.

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The 10 Global Fastest Declining Industries
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  • Global Iron Ore Mining. ...
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  • Global Investment Banking & Brokerage.


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