Many companies had been limiting corporate travel because of health concerns and travel restrictions. Now there are new worries about the soaring cost of travel and its impact on businesses’ much ballyhooed climate commitments.
Why it matters: Unlike leisure travel, which is now roaring back, business travel is at least two years from a full recovery, according to new research from Deloitte.
Driving the news: Many companies are summoning workers back to the office after two years of remote work.
- Long-delayed team meetings have been rescheduled and conferences are slowing shifting back from online to in-person events.
- All of that is likely to mean a gradual uptick in corporate travel over the remainder of 2022, according to Deloitte’s annual survey of 150 corporate travel managers.
- But it will be a slow recovery. Travel spending is expected to rise from about 36% of 2019 levels in the second quarter to 55% of pre-pandemic spending by the end of the year, Deloitte says.
- Travel to Europe will bounce back close to 2019 levels, but Asia and Latin America will continue to lag far behind.
Between the lines: Companies are reassessing and reprioritizing when and why employees travel.
- Many bosses are keen to maintain the financial savings and climate benefits they saw during the pandemic when employees worked from home and corporate travel was limited.
- Three in 10 companies expect sustainability to cause an 11% –25% reduction in travel budgets by 2025.
- Plus, there are risks that could depress business travel, including new COVID-19 variants and the war in Ukraine.