The path to recovery
Global business travel spending is expected to surpass its pre-pandemic spending level of US$1.4 trillion in 2024 and is forecast to grow to nearly $1.8 trillion by 2027*.
Global business travel spend rebounded significantly faster in 2022 than was expected just a year ago. In 2022, global business travel spending rose 47 per cent to $1.03 trillion, with a further 32 per cent growth expected in 2023. These robust gains were fuelled by pent-up demand following the Covid-19 pandemic, more favourable global economic conditions, and recession risks that have yet to happen. The return of in-person meetings and events, and the recovery of some international business travel capacity and volumes, played pivotal roles in this growth.
Rising fuel prices, labour shortages and supply chain disruptions – exacerbated by surging demand – led to skyrocketing travel prices in 2022
However, this rebound came with pricing challenges. Rising fuel prices, labour shortages and supply chain disruptions – exacerbated by surging demand – led to skyrocketing travel prices in 2022. While global business travel and events costs are set to climb higher throughout the remainder of 2023 and into 2024, we anticipate this to be at a more moderate pace than was seen in 2022**.
Regional and industry variations
Business travel trends will continue to vary across regions and industries. Western Europe was the fastest-growing region globally in 2022, while North America and Latin America saw spending growth accelerate significantly.
Emerging Europe continues to lag in its recovery, challenged by the war in the Ukraine, while, regionally, Asia Pacific was the big laggard last year, given the delayed reopening of the Chinese economy.
Business travel spending recovery also continues to differ according to industry, with construction, education, and professional, scientific and technical activities showing the most resilience, and other sectors – notably wholesale trade, retail trade, and information and communication – showing the least resilience.
Factors influencing business travel in 2024
Despite the resilience of the global economy and positive outlook for business travel spend, several factors will impact the business travel landscape as we look ahead to 2024 and beyond:
The ongoing war in Ukraine remains a critical concern. Its implications on global stability, diplomatic relations and travel restrictions remain unknown.
Persistent inflation in specific areas, including the cost of goods and services relevant to business travel, can further strain corporate budgets.
With a growing emphasis on environmental responsibility, businesses are expected to intensify sustainability initiatives and look for ways to further reduce carbon footprints. Business travel is an obvious focus area.
Meeting technologies and remote work tools will continue to evolve, shaping the future of business meetings and events.
Business travel trends will continue to vary across regions and industries
The future of work
Remote working and the hybrid work environment continues to evolve as companies and employees look to find the right work-life balance. Digital nomads are now more mainstream and companies need to continually adapt their travel policies to accommodate the new way of working.
The rise of blended travel, combining business and leisure travel, is a growing trend since the pandemic as employees look to maximise their travel experiences again.
Balancing act ahead
Rising costs and pricing pressures will likely continue to be a significant factor in business travel for the foreseeable future with pricing fluctuations across industry verticals, business sectors and global regions. While business travel continues to rebound, there will be a delicate balancing act between demand, cost management and environmental, social and governance (ESG) concerns.