Marketing 3 min read

Impact of the COVID-19 Pandemic on the Travel Industry

ClassicVector / Shutterstock.com

ClassicVector / Shutterstock.com

The COVID-19 pandemic could cost the travel industry 75 million jobs and $2.1 trillion in revenue if it continues. But how long would it take to recover?

The impact of the current coronavirus pandemic extends across various economic activities, and this includes the travel industry.

According to a survey, the global business travel sector will take an $820 billion COVID-19-related revenue hit.

Hotels and airports reported a significant decline in foot traffic last month. Meanwhile, ten cruise ships around the globe — carrying nearly 10,000 passengers — are still unable to dock at due to coronavirus fears.

The travel industry in the United States is among the hardest hit.

A recent report from the U.S. Travel Association projects a loss of 4.6 million jobs through May. Yet, this number is likely to increase as the virus continues to spread.

According to another report, weekly unemployment claims in the country surged to a whopping 6.6 million, which is by far the biggest spike in half a century. Tourism decline in states, including Nevada, is reportedly the driving reason for the massive fall.

In a statement to the press, president and CEO of the U.S. Travel Association, Roger Dow said:

“The impact on travel is six or seven times greater than the 9/11 attacks.”

If the pandemic continues for several months, the cost could increase significantly. The World Travel and Tourism Council projects a loss of 75 million jobs and $2.1 trillion in revenue.

But for how long?

How Long Would it Take the Travel Industry to Recover From the COVID-19 Pandemic?

To answer this question, a team of researchers looked at download trends in China over the past few weeks.

Kolin Schunck and colleagues at travelandmobility.tech analyzed app downloads in China across major categories in Travel and Mobility tech. These include air travel, urban mobility, accommodations, as well as online search and booking.

For each sector, the researchers selected the top five mobile apps based on the number of downloads it got within the last 12 weeks. Next, they calculated the weekly changes in app downloads.

After using a two-week moving average to smoothen the trend lines, Schunck and colleagues noted a promising result.

Findings revealed that that Chinese travelers are ready to travel again. China has already lifted travel restrictions in Hubei — the province where COVID-19 first emerged.

Authorities have already re-establish trains, roads, and rail connections. Although air service is still limited, 200 flights are already scheduled to depart Wuhan on Wednesday.

The researchers also pointed out that airline app download volumes in China increased 73 percent in early March compared with February. Aside from correlating with the number of flight booking, the figures show that many people are mentally preparing to travel.

But what does the number mean for the travel demand in the United States?

Kolin Schunck wrote:

“We expect to see similar trends in the West, depending on how effective current measures are at reducing the spread of Covid-19.”

Schunck further explained that the shock-recovery time for the U.S. could be longer compared with China. And that’s due to the drastic measures that the Chinese government took to curb the virus spread.

While these measures are harder to implement in American and European democracies, we still believe the six-week recovery time to absorb the initial shock is a reasonable benchmark, says Schunck.

Read More: Publishing Groups Want Ads Alongside Coronavirus Content

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