Business travel in the US and Europe is projected to reach over 50% of pre-pandemic levels in H1 2023, with full recovery expected by late 2024 or early 2025, Deloitte reports. Live events are anticipated to drive significant growth, as over half of travel managers in both regions foresee industry events spurring travel in 2023. International trips are set to increase, with US companies projecting a rise in international travel costs from 21% in 2022 to 33% in 2023. Factors such as flexible work arrangements and technology use have led to client-oriented travel taking precedence over team building and internal meetings. Sustainability is also a key focus, 40% of European companies must reduce travel per employee by over 20% to achieve their 2030 sustainability targets.
The European landscape: A phased recovery
In Europe, business travel is making a strong comeback, with recovery at 60% of pre-pandemic levels according to the Q1 2023 Global Business Travel Association (GBTA) outlook. Domestic business travel in Europe has returned to 63%, with regional and domestic travel expected to recover first, followed by international travel as government regulations and pandemic situations stabilise. The impact of technology on business travel is evident in the shift towards virtual meetings and events, reducing the need for certain types of travel.
Major industry events will likely be the last to return, requiring higher confidence in public safety. Events will adopt virtual, hybrid, or multilocal models with revised in-person schedules and physical distancing measures implemented in modified venues. The business travel recovery in Europe will be a phased process, with domestic and regional travel preceding international travel. Sales and client-related meetings will return first, while technology will replace many internal meetings, changing the landscape of business travel permanently.
Embracing technology and sustainable solutions
As European companies adapt to the changing business travel landscape, they must evaluate policies and practices considering increased travel and rising costs. Hybrid meetings offer cost savings by allowing employees to attend only the most important meetings in person.
Technology has played a significant role in shaping the future of business travel. Videoconferencing has replaced face-to-face meetings for 42% of businesses, but the appetite for business travel remains. As companies plan for increased travel, they must balance the benefits of in-person interactions with the capabilities of technology to meet a variety of business needs. Workplace flexibility and the expected rise in work-from-home rates will continue to impact how and when employees travel for work.
As sustainability becomes a key focus for businesses, travel suppliers and travel management companies must adapt to the changing priorities of their clients. Companies that take a long-term view and communicate their sustainability progress will be better poised to navigate ongoing shifts in travel priorities. By implementing sustainable solutions and embracing technology, businesses can ensure a more responsible and efficient approach to business travel in the post-pandemic world.
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