Excerpt from Hotel News Resource
Delta Variant, Supply Chain Woes, Consumer Spending Are Worries
Bernard Baumohl, chief global economist of The Economic Outlook Group, laid out his forecast for how the U.S. economy will influence hotel industry recovery at The Lodging Conference this week in Phoenix, calling for “a fairly significant slowdown this fall and winter.”
“There are still great concerns about the delta variant spreading,” he said. “In addition, we don’t seem to see the supply chain bottleneck easing up. Third, energy prices are moving up and that’s going to cut into consumer spending. And finally, there’s a basic scarcity of goods — raw materials, intermediate goods and finished products. That will continue to cause prices to move up.”
These hits affect most major U.S. and international business sectors, but Baumohl said he is optimistic that a more normalized business and economic cycle will characterize most of 2022 and 2023 “if we can simply look just past this winter and fall,” he said.
One big reason for his optimism are vaccination rates slowly rising in the U.S.
“We’re seeing more people feel more comfortable about going out and going back to work,” he said.
However, the delta variant of COVID-19 still “weighs heavily on employers,” reflected in hiring declines throughout August.
“Leisure and hospitality showed zero new hiring in August, after seven months when we saw hiring in leisure and hospitality average out to 350,000 jobs per month,” he said.
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