Travel Agencies Affected by Economic Recession

The present economic recession has affected people from all walks of life. As their wallets grew slimmer, people started to postpone or cancel their travel plans and vacation plans to a great extent. Business travel is one of the main cash earner for travel agencies and this is certainly bad news for travel agencies. They are having a real tough time staying afloat during this time. As the common man is reducing or avoiding travel plans, the travel agents are the ones who are going to face the toughest financial crisis.

Business travelers form a significant portion of the business conducted by travel agencies. As the expenses are part of business expenditure, companies tend to make travel an integral part of daily business. Discussions regarding new deals, opportunities, strategies etc are formed during these trips. Many businesses offer paid trips for politicians and other wheeler-dealers for the favors received. In regular atmosphere, this is considered as part and parcel of doing business. No body frowns upon it or questions it. But during a recession, especially when the public and politicians are having a negative opinion on the methods employed by companies, paid for business trips are bad public relations for companies. Hence many of these firms avoided their travel programs or postponed them indefinitely. This hurt the travel agencies a lot.

Companies are the ones who are usually booking group travel arrangements. In this time of added scrutiny on their behavior, they are extra wary of engaging in these practices and kept away from their normal tour plans. Politicians who were ineffective in tackling the economic down turn has jumped on the business interests as a scapegoat in their attempt to score some cheap brownie points. As the scrutiny on each of their actions has increased, businesses started to keep their travel plans, be it leisurely or important business trips, on hold. All this has increased the burden on travel agencies again.

As of now, there is a decrease of a third of the average over all business travel during the last 3 months. Conferences and seminars are a major income source for travel agencies. As the vilification of corporate executives is going on, they are more than willing to avoid organizing or participating in any such functions. And this is not at all good news for travel agencies.

Politicians need to show some more statesmanship and avoid scoring cheap brownie points at the expense of such an important industry. There are a lot of people out there making a living out of travel and tourism sector. The government should do every thing to support the industry in this tough juncture.

As the recession is thought to stay here for this year and possibly in to the next year, travel agents need the support of the government machinery. Hyping and vilifying business sector and industry practices is not going to be beneficial for this industry for the near future and for the revival of the economy as a whole.