The Impact of Inflation on Tourism and Travel [2022 Study]

the impact of inflation on travel

Here’s the stark reality:

The reopening of post-pandemic economies and the raging war in Ukraine have created a perfect storm of stagflation. The world economy is facing headwinds, and prices are continuing to climb.

While travel will somewhat rebound due to the easing of restrictions, the sharp rise in airfares and other commodities means the tourism sector won’t fully recover until 2024. That’s according to 63% of experts from the World Tourism Organization (UNWTO).

Thus, a summer trip might now cost way more than in 2019.

But—how much is too much?

To find out, we’ve decided to reach out to ~1,000 Americans and ask them if inflation is wreaking havoc on their travel budgets, whether they had to downgrade their vacation plans, and much more.

So let’s dive in.

inflation vs. travel: study’s key takeaways

Key Takeaways

  • Almost nine in 10 vacation-goers (88%) were muscled to downgrade their vacation plans due to inflation and soaring prices.
  • Most US travelers had to budget 11–20% more toward travel to keep their plans afloat.
  • 96% of Americans still plan to go on vacation in 2022.
  • For 85% of Americans, higher airfares made them seek alternative means of transportation when traveling this year: 75% will opt for an (electric) car.
  • 72% of vacationers are likely or very likely to (further) cut back on travel in 2022 and beyond if inflation persists.

Related readings:

Inflation vs. Travel: The State of Affairs

how inflation affected travel in 2022

Consider this:

Inflation has jumped to 8.6% in the past year. That’s the biggest year-over-year increase since 1981.

Yet—

When we asked Americans if they plan to go on vacation at any point in 2022, 96% said, “Yes.” Here’s how many leisure trips they intend to take this year:

  • Two: 35%
  • Three: 24%
  • One: 15%
  • Four: 14%
  • Five or more: 11%

Next, we asked how much vacation-goers are prepared to spend on travel (per person):

  • $2,001–$3,000: 21%
  • $3,001–$4,000: 20%
  • $1,001–$2,000: 20%
  • $501–$1,000: 18%
  • $4,001 or more: 15%
  • $0–$500: 6%

As you can see, about nine in 10 Americans are looking to vacation in 2022. Most (35%) plan to take two trips and budget between $2,001 and $3,000 per person toward them, despite high inflation pushing prices up.

How come?

One explanation for it is that many people are itching to travel again. So, in the battle between pent-up, post-COVID-19 demand and soaring costs, the desire to travel prevails.

But—

Inflation takes its toll.

When we asked the respondents if they had to budget more toward travel this year compared to 2021/20, 94% answered positively.

How much more, exactly?

  • 0–5%: 7%
  • 11–20%: 33%
  • 21–30%: 32%
  • 6–10%: 28%

So, most US travelers had to budget as many as 11–20% more toward vacations to keep their plans afloat.

As a follow-up, we asked the survey takers if they were also muscled to downgrade their 2022 vacation plans. Nearly nine in 10 (88%) said, “Yes.” It means travelers will cut spending across all major trip components, from lodging to dining to recreation and entertainment.

Other cost-saving methods include driving rather than flying. After all, the average price of jet fuel is now about $4.15 per gallon, or ~149% more than a year ago, according to the International Air Transport Association (IATA). That has a profound effect on airfares.

In fact, our study finds that for 85% of Americans, higher airline ticket prices made them seek alternative means of transportation when traveling in 2022. They are as follows:

  • (Electric) Car: 75%
  • Train: 66%
  • Bus: 60%
  • Ship: 43%

Finally, 72% of American vacationers said they are likely or very likely to (further) cut back on travel in 2022 and beyond if prices continue to rise.

So—

Inflation is here, and it’s after travelers’ budgets.

5 Key Reasons Against Vacationing in 2022

5 key reasons against vacationing in 2022

We’ve mentioned earlier that most Americans (96%) intend to travel this year, based on our findings.

But—

That number seemed a bit too optimistic when we compared it to similar studies. For instance, NerdWallet found that only 70% of American adults plan to hit the road in 2022. On the other hand, The Vacationer reports that 81% are looking to travel in the summer alone.

So, the truth is likely somewhere in the middle. Thus, we decided to uncover the key reasons against vacationing in 2022. 

Below are the results:

  • High inflation and rising prices: 49%
  • COVID-19 concerns: 48%
  • I have family obligations: 38%
  • I can’t take time off work: 37%
  • My health wouldn’t agree with it: 22%

As the data shows, high inflation and rising prices make some Americans stay put. You might’ve also noticed that 37% of the respondents mentioned their work prevents them from going on holidays.

That piqued our interest, so we decided to unearth why some employees wouldn’t use their vacation time.

Below are the results (with a text version just in case):

why employees won’t use vacation time
  • My current workload prevents me from going on vacation: 51%
  • I feel pressured not to use my vacation days: 40%
  • No one else can cover for me while I’m away: 31%
  • I don’t want to return to a mountain of work: 18%

Now—

Working professionals who don’t take time to recharge their batteries could have lower job performance, experience burnout, and suffer from chronic sleep deprivation, among others. 

So employers, take note!

8 Cost-Cutting Measures Vacation-Goers Take to Keep Costs in Check

8 cost-cutting measures vacation-goers take to keep costs in check

Without a doubt, most travelers are feeling the squeeze. That’s why knowing how to strategize is essential, so inflation doesn’t nix your travel plans.

In this context, we gave the survey respondents a list of eight cost-cutting measures and asked which ones they plan to take when traveling in 2022. 

Below are the results:

  • Travel shorter distances: 59%
  • Take fewer trips: 58%
  • Pick more budget-friendly destinations: 58%
  • Spend less on dining: 57%
  • Stay in more affordable accommodations: 56%
  • Cut down on activities: 56%
  • Make my stay(s) shorter: 55%
  • Opt for destinations closer to home: 53%

There you have it.

If you have any savvy tips for being a frugal traveler in a world of rising prices, share them in the comments below!

Methodology

We conducted an online survey of 991 US respondents via a bespoke online polling tool in June 2022. This study was created through multiple steps of research, crowdsourcing, and surveying. All survey participants’ responses were reviewed by data scientists for quality control. ​​The survey had an attention-check question.

Fair Use Statement

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