Event planners have been struggling with rising costs, and there is no sign of this improving until 2024, according to the latest Global Business Travel Forecast.
Global travel prices will continue to increase this year and next, a new report from CWT Meetings & Events, a global corporate events management service, and the Global Business Travel Associaton (GBTA) reveals. The cost-per-attendee for meetings and events this year is expected to be around 25 percent higher than in 2019, and it’s forecast to rise an additional 7 percent next year.
Rising fuel prices, labor shortages, and inflationary pressures in raw material costs are driving these increases, according to this year’s joint Global Business Travel Forecast, published Wednesday.
Russia’s invasion of Ukraine, the rising tension between China and Taiwan, and other geopolitical uncertainties are pushing costs higher.
Finding event space will be challenging as remote work continues to be popular, and companies are booking space to gather their staff in person several times a month.
“We are seeing the highest levels of demand for in-person meetings and events since the pandemic began. Face-to-face meetings and events have rebounded sharply — 65 percent more this year versus 2021 — whilst virtual event volumes have scaled back by 70 percent versus 2021, illustrating the enduring value of in-person interaction to companies looking to rebuild culture and attract and retain staff,” said Beau Ballin, global head market development, CWT Meetings & Events. “However, a perfect storm of pent-up demand, competition with events canceled during the pandemic, inflationary pressure, and shorter lead times is leading to an increase in cost-per-attendee.”
Event planners have shorter lead times to contend with. The average lead time is one to three months compared to six to 12 months in the past. Uncertainty regarding Covid and geopolitical uncertainty is contributing to this.
“Demand is unlikely to abate,” said Ballin. “To get the best value from long-awaited meetings and events and mitigate against rising costs, corporations will need to plan further in advance, budget carefully, and adopt a disciplined approach to managing meetings and events across the organization.”
An increase in airfare and hotel rates is hitting events hard. Airfare continues to skyrocket, with prices expected to rise 48.5 percent this year and an additional 8.4 percent next year. Interestingly, even with this steep price increase, prices are expected to remain below pre-pandemic levels until 2023.
Hotel prices have increased 18.5 percent this year, followed by an 8.2 percent rise next year, and have already eclipsed 2019 levels in some areas of Europe, the Middle East and Africa, and North America.