Business travel spending globally is rebounding at a faster-than-expected rate and is forecast to exceed its pre-Covid levels of $1.4 trillion in 2024 and grow to nearly $1.8 trillion by 2027 amid stable economic conditions.
The accelerated pace of recovery is due to pent-up demand, the return of in-person meetings and widespread economic recessions failing to materialise, according to the Global Business Travel Association (GBTA)'s latest annual outlook report.
The recovery is taking place faster than the previously projected timeline of mid-2026.
Global business travel spending in 2022 rose 47 per cent year-on-year to $1.03 trillion and is expected to grow 32 per cent in 2023 to $1.36 trillion, GBTA said.
“The headwinds that were anticipated to impact the rebound of global business travel over the past year didn’t materialise and that is good news," said Suzanne Neufang, chief executive of the GBTA.
The report findings indicate "an accelerated return to pre-pandemic spending levels sooner than anticipated as well as growth ahead in the coming years".
The report, published by the GBTA in collaboration with Visa, covered 72 countries and 44 industries. It surveyed 4,700 business travellers across North America, Latin America, Western and emerging Europe, and Asia Pacific.
Companies worldwide, from multinationals to smaller family-owned businesses, rely on travel to meet clients, boost revenue or connect with their employees in global offices.
Over the past 18 months, the most important factor driving the pace of the global business travel recovery is the progress made fighting the Covid-19 pandemic.
The two biggest drivers in the industry’s stabilisation in the past six months have been the return of in-person meetings and corporate events, and the recovery of some international business travel capacity and volumes, the report said.
In terms of regions, Western Europe was the fastest-growing region in 2022 for the recovery of business travel.
North America and Latin America's business travel spending growth also accelerated significantly in 2022.
However, emerging Europe continues to lag in its recovery, challenged by the war in the Ukraine, the report found.
Regionally, Asia Pacific was the "big laggard" last year due to the delayed reopening of the Chinese economy, it said.
Chinese business travel spending fell 4.6 per cent last year, pushing the country to the number two business travel market in the world for the first time since 2014, the group said.
However, China is expected to recover back to being the top business travel market in the world by the end of 2023, according to its forecast.
In terms of industries, construction, education, and professional, scientific and technical activities showed the most resiliency in spending on work trips.
'Promising' outlook but challenges remain
"Looking forward, numerous challenges remain, including the war in Ukraine, persistent inflation in certain areas, much tighter global financial conditions and deterioration in the manufacturing sector," the report said.
While a "promising" rebound is expected, the industry's longer-term forecast will be affected by an increased focus on sustainability initiatives, widespread adoption of meeting technologies, growth in the remote workforce and the rise of blended travel.
The factors are "potential game changers" in the future of business travel, though currently there is not enough data to solidly forecast the potential impact on business travel spending and volume, the GBTA said.
Eighty-two per cent of the GBTA survey respondents said that business travel was very or moderately worthwhile in achieving their business objectives.
Business travellers globally currently estimate their own business travel spending, on average, amounts to $1,018 per person per trip. On average, accommodation accounts for $391, while food and beverage is $189. Air travel averages $182, while ground transportation ($136) and miscellaneous expenses ($120) rounds out the total.
About 62 per cent of the surveyed business travellers say they are more frequently blending business and personal trips, known as "bleisure" travel, than they did in 2019, with 42 per cent adding additional leisure days to their business trips. Up to 79 per cent of these travellers stay at the same accommodation for the business and holiday portions of their trip.
In terms of payment methods for business travel, 66 per cent of business travellers say their company provides them with a corporate credit card – of that percentage, about one-third say their company mandates its use for booking business travel.
For those provided a corporate card, 64 per cent have uploaded their card to a mobile wallet. Almost 87 per cent use their mobile wallet for at least 10 per cent of their business transactions.
“As travel continues to rebound, we expect digital payments to continue to grow because they make it easier and more secure to do things like purchase plane tickets for business travel or split a check at dinner,” said Gloria Colgan of Visa Commercial Solutions.