Decline in business travel could be permanent, analyst Beroe finds
Raleigh-Durham Airport Authority | August 10, 2021
Corporate business travel on airlines is expected to shrink by as much as 19 percent, and that decline could become permanent, an analysis from Raleigh-headquartered Beroe, Inc. found.
“When travel restrictions were imposed worldwide, businesses replaced direct meetings with virtual ones to contain the pandemic’s spread. Many businesses adapted to virtual meetings and have realized that not all meetings must be in-person. Businesses have also realized huge cost savings on air travel spend,” said Anusree Mohan, senior analyst at Beroe, in a statement. “In the future, airline travel will be a more mindful and thought-out way of traveling, allowing employees to have a better life balance and employers to have a better return on investment.”
Prior to the onset of the global coronavirus pandemic, business travelers represented about half of airline revenue, or about 1.7% of total global GDP, according to Beroe.
But with businesses seeking cost-saving measures, and integrating virtual meeting tools to conduct meetings, Beroe analysts are predicting short- and long-term effects on air travel.
“Businesses have suffered around the world in this pandemic. Thus, cost-cutting will remain their prime focus at least for the coming few years. And this will mean fewer corporate air travels,” said Anusree Mohan, Senior Analyst at Beroe. “Employee travel rate will decrease as corporate customers will remain concerned about health and safety.”
At Raleigh-Durham Airport (RDU), air traffic consisted of about 50% leisure and 50% business travel, spokesperson Stephanie Hawco told WRAL TechWire.
“The leisure market is recovering faster than the business market,” said Hawco. “Our current mix is about 65% leisure and 35% business.”
At the onset of the global coronavirus pandemic, and soon after, a dramatic reduction in air travel occurred at RDU, Hawco told WRAL TechWire in March. Compared to 2019, when about 14 million passengers traveled through the airport, 5 million traveled through the airport in 2020, Hawco noted.
Air travel through RDU is steadily increasing, Hawco said. The latest available data, from June 2021, released by the Raleigh-Durham Airport Authority, showed that June travel set a new passenger traffic peak since the onset of the pandemic in 2020.
The airport saw more than 887,000 guests pass through the airport in June, nearly a 15 percent increase over May traffic levels.