The travel industry has lost a full third of all the jobs lost in the U.S. and is experiencing a total impact from coronavirus that is nine times greater than the 9/11 attacks, according to new data released by the U.S. Travel Association and the analytics firm Tourism Economics.
By the end of April, declines in travel will cause eight million jobs to be lost out of approximately 24 million for the entire U.S. economy, according to the report. Travel spending losses are on track to top half a trillion dollars by the end of 2020. “The CARES Act was a good start, but the data shows there is still extreme and mounting pain in the American travel industry,” said U.S. Travel Association President and CEO Roger Dow. “We’re appealing for fixes, the addition of more relief, faster rules, and greater flexibility.”
A central issue: Paycheck Protection Program funds have already been depleted and are in urgent need of replenishment, Dow said.
“The relief program needs to fit the crisis, and we’re still learning the magnitude and intricacies of this particular crisis,” Dow said.
Other data analysis released by U.S. Travel this week compounds the dire economic picture for the American travel economy:
* Overall travel spending last week plunged to $2.9 billion - an 85% drop since the first week of March and 87% lower than the same week in 2019, according to a separate analysis by Tourism Economics
* 90% of travelers surveyed had some type of travel or travel-related activity planned prior to the COVID-19 outbreak and 80% of those either canceled or postponed those plans, according to survey data from MMGY Travel Intelligence.
To address other issues with the CARES Act, U.S. Travel has urged Congress to:
* Expand eligibility for the Paycheck Protection Program (PPP) to DMOs that are classified as 501(c)(6) non-profits or "political subdivisions" of their local governments, as well as to small businesses that operate multiple locations (with fewer than 500 employees per location).
*Appropriate an additional $600 billion for the PPP and extend the coverage period through December 2020. The PPP is currently slated to expire on June 30 -the economy will not realistically be in recovery by then- and the initial round of funding is expected to run out in just a few weeks.
*Revise the PPP maximum loan calculation to 8x a business’ monthly outlays, and allow it to cover both payroll and non-payroll expenses. Currently, the formula is 2.5x and covers payroll only, not other expenses - inadequate for immediate needs.