Twin pressures of economic weakness and uncertainty are causing twice as many U.S. companies as previously expected to cut their travel spending this year, a new report by the Association of Corporate Travel Executives said.
“There’s only two things that companies have immediate control over when the economy turns bad: personnel and travel,” association executive director Susan Gurley told USA Today in its Feb. 9 editions. “That’s why we believe that as long as joblessness is still on the rise, travel spending won’t begin to bounce back.”
The association said 71% of its member companies now plan to spend less on travel this year than in 2008. In September, only 33% of respondents said they expected to cut back. In fact, 36% said they would be spending more on travel in 2009, USA Today said.
But in the just-completed survey, only 8% of the responding ACTE member companies — typically midsize or large U.S. corporations and institutions — now expect to spend more on travel this year and most were expecting to spend 10% to 20% less on travel, USA Today said.
As for the impact, ACTE figures the 176 member companies that responded to the survey will collectively spend about $880 million less on travel this year than they had planned, the report said.
Gurley told USA Today if the same estimation is applied to the ACTE’s full membership — about 2,400 companies — the impact would be more than $2 billion in foregone travel spending this year.
This article was submitted by Kathleen O’Connor, a contributing writer for Biz2Credit. Biz2Credit is a small business marketplace that provides entrepreneurs with the latest industry news and financial advice. Send all questions to email@example.com.