Hotel association releases report on economic outlook for 2021

(The Center Square) – Illinois hotels have been greatly impacted by the pandemic and will face the same challenges in 2021, according to a new report.

The American Hotel and Lodging Association has released its State of the Hotel Industry 2021, and the outlook is bleak. How bad is it for hotels? The AHLA report says that the impact of the pandemic on their businesses has been 9 times greater than the impact of 9/11. The report says business travel this year, which is key to the hotel industry, is expected to be down 85 percent compared to 2019.

“COVID-19 has wiped out 10 years of hotel job growth,” Chip Rogers, AHLA’s president and CEO, said in a statement. “Yet the hallmark of hospitality is endless optimism, and I am confident in the future of our industry.”

The employment numbers in the hotel industry are startling. Nationwide, hotels will add 200,000 direct hotel jobs in 2021, but will remain nearly 500,000 jobs below the industry’s pre-pandemic employment level of 2.3 million employees.

Michael Jacobson, president and CEO of the Illinois Hotel and Lodging Association, said Gov. J.B. Pritzker needs to address COVID-19 restrictions to allow the convention business to return.

“We need some middle ground, some sort of stepping stone approach to be able to gradually resume larger events while we are still waiting for the vaccine to roll out at a greater capacity,” said Jacobson.

Jacobson said the obstacles the hotel industry is facing has a trickle-down effect because of the loss of tax revenues, adding that every Illinois household would have to pay $1600 more in taxes each year if not for the revenue generated by hotels.

“Cities and states have come to depend on that revenue and are going to find other ways to offset it while we wait for the hotel industry recovery,” Jacobson said.

Travel for leisure is expected to be the first to return, with 56% of consumers expecting to travel in 2021, which is roughly the same amount as an average year.

During a global pandemic, you would think the most important key to getting people back into Illinois hotels would be enhanced cleaning standards by the hotels. The AHLA report shows that it is important to consumers but came in at No. 2. The more important key is the price of the room.

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