Majority of firms confident travel 'on the path to recovery'

Travel is now more of a “priority area” for consumers, with 24% planning to spend more on holidays in the next 12 months than in the previous year, ranking ahead of all other spending categories apart from eating out (25%).

Less encouraging, though, is that the number of people expecting to spend less on holidays year- on-year is also high at 25%. “Travel intent is hardening, with a higher proportion of people having been on holiday or who are now willing to go on a trip,” said Scott. “There’s a lot more willingness to travel – but there is a big proportion who are still wary of travelling internationally.”

Recruitment worries

Willingness to travel has risen across all age and social groups, but there is some “polarisation”, with younger people most confident to go abroad along with more affluent groups.

Operators say testing and quarantine are still the biggest barriers to travel, but a large proportion of the public remains fearful of catching Covid – a factor the industry seems to underestimate.

The trade expects holiday prices to be higher in 2022, with margins also forecast to be flat or higher. This tallies with research showing consumers are willing to spend more on holidays by using companies that can offer them reassurance and high service levels.

The most eye-catching change from the summer is that retention and recruitment of staff has become the biggest short-term concern for operators, rising from 9% in June to 37% in October.

The impact of travel restrictions has become less of a concern for the industry, but one worry that has risen significantly is the potential effect of a consumer downturn, up from just 4% in the summer survey to 21%.

Bookings are likely to continue being made later than normal for the rest of 2021 and into next year, which could create challenges for travel firms when it comes to managing capacity and marketing budgets for peaks.

The survey also illustrates how travel businesses are at “very different” stages in terms of implementing sustainable travel strategies. This is an issue travel will need to tackle, as consumers are becoming more aware of sustainability and now expect operators to be sustainable, particularly for under-35s.

There is, however, still a noticeable “gap” between holidaymakers’ intent and action. Currently, only 28% would be willing to pay extra for a more sustainable holiday, while 48% said the holiday experience remained more important than sustainability.

The full findings of the TTG-PwC research for Agenda 2021 is available to TTG+ members here.