Certainty Elusive in Current Corp. Travel Demand Analysis

After a turbulent 2025 that featured buyers and suppliers alike wrestling with changing macroeconomic conditions and a stream of disruptive news, the year appears to be ending with at least some upswing in overall U.S. business travel demand. But the evidence for that isn't unassailable, and other metrics and analysis suggest that many companies remain reluctant to commit to significant travel expenditure in a time of continuing uncertainty.

Much of the evidence for an autumnal increase in business travel volume comes from U.S. airlines, which since September have suggested that a bounceback was afoot. That exuberance continued to carriers' third-quarter earnings calls. United Airlines executives, for example, said contracted corporate revenues in September increased 13 percent year over year amid an overall third-quarter acceleration, and Delta Air Lines CEO Ed Bastian said that after the business travel slowdown of the spring and summer, "There was some level of pent-up demand to get back out. … Clearly, for four or five months this spring, we were not seeing any corporate growth, and then they all got back on the road together at the same time." 

Delta's third-quarter corporate sales increased 8 percent year over year, according to the company, and third-quarter corporate travel revenue at Alaska Air Group carriers, including Alaska Airlines and Hawaiian Airlines, also increased 8 percent, the company said in a statement. American Airlines said its Q3 managed business revenue was up 6 percent.  

There are other signals of a business travel rally, at least to some extent. The number of trips sold in September by travel agencies with at least 70 percent self-reported corporate and government business and settled by the Airlines Reporting Corp. increased 0.44 percent year over year. That may not sound like much to write home about, and it's an imperfect metric, but it's nevertheless the first time all year in which those monthly trips sold increased year over year. 

Other metrics and analysis, however, don't necessarily line up with the notion of a broad-based business travel bounceback, particularly those related to U.S. hotels. As of mid-October, weekly U.S. hotel occupancy had declined year over year for 17 straight weeks, according to hotel analytics firm STR, and October occupancy and revenue per available room was set to decline from 2024 levels just as it had in September. 

And though the midweek occupancy that is the hallmark of business travel had at times increased in recent weeks, along with rates, in cities like San Francisco and Chicago, it was often tied to individual large events and softened in cities like Miami and New Orleans. Additionally, STR in recent months reduced its full-year 2025 hotel performance forecast, as did Lodging Analytics Research & Consulting.

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RELATED: STR's Freitag on Another U.S. Hotel Forecast Downgrade

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Unlike the airlines' third-quarter experience, Hilton Worldwide's business transient RevPAR dropped 1 percent year over year, and CEO Christopher Nassetta went so far as to call corporates "rattled" by continued economic uncertainty. He expressed optimism for 2026 demand, though.

Divining the Trends

Business travel analysts weren't necessarily of one mind in their assessment of demand trends either. Craig Fichtelberg, co-founder and COO of travel management company AmTrav in an email to BTN said that "we have seen a slight decline in year-over-year business travel demand, though the severity of this downturn has been noticeably shrinking as the year has progressed." 

Fichtelberg said economic uncertainty surrounding the global trade levies initiated by the United States primarily led companies to pull back on travel, but "businesses have seemingly adjusted to and begun managing around the uncertainty." That has allowed drivers of increased travel demand, particularly AI, to come to the fore, "essentially creating a snowball effect that is increasingly offsetting the earlier negative impacts of trade-related concerns."

Acquis Consulting Group head of corporate travel consulting Chloe Carver noted several clients were in the midst of merger and acquisition activity, a move that "creates opportunities to consolidate spend with preferred suppliers and leverage their collective buying power in negotiations," she said in an email. "From a supplier's perspective, this consolidation can look like demand volatility." 

Partnership Travel Consulting founder and CEO Andrew Menkes said he did not believe business travel demand to be on an upswing. "I think it's looking soft for the obvious reasons—geopolitics, tariffs, stuff still going on in Eastern Europe and Ukraine, and tightening budgets," he told BTN. "This is the time of year that everybody tightens budgets anyway."

Menkes suggested the airlines' high spirits about the sector were a factor of the capacity cuts undertaken after the sluggish first quarter. "The major airlines got really smart by reducing capacity," he said. "Virtually every flight is chock-a-block full. One of the reasons they’re enjoying this positive outlook and increased profitability is they reduced capacity—smaller, less fuel-efficient planes out, fewer flights. … It’s not necessarily an increase in demand per se; it’s an increase in yield with limited space."

Assessing Other Metrics

Other metrics often evaluated to project corporate travel perhaps don't point to strong trends in any particular direction.

- Projected third-quarter U.S. global domestic product forecasts suggest solid to strong economic growths, with projections at press time of 2.4 percent year-over-year growth by the Federal Reserve Bank of New York and 3.9 percent by the Federal Reserve Bank of Atlanta.

- The availability of current unemployment figures is affected by the U.S. federal government shutdown, but the Federal Reserve Bank of Chicago estimated October's U.S. unemployment rate would be 4.35 percent, a tick higher than the 4.34 percent it estimated for September. The most recent monthly unemployment rate released by the U.S. Bureau of Labor Statistics was 4.3 percent for August, suggesting a steady labor market.

- According to preliminary U.S. International Trade Administration data, the total number international visitors to the U.S. who entered on business visas or through the Visa Waiver Program, excluding Canada and Mexico, in August increased 0.1 percent year over year. That's compared to a 2.9 percent decrease in all international visitors to the U.S. in August, again excluding those from Canada and Mexico. Travelers entering the U.S. from Mexico in August on business visas who arrived in manners other than land decreased 13.8 percent year over year. (September data isn't available due to the government shutdown.)

- Inbound U.S. travel from Canada remains low, continuing a trend in which some Canadians have avoided traveling to their southern neighbor. In September, Canadian residents' return trips from the United States via air declined more than 27 percent year over year even as return air trips from other countries increased by nearly 4 percent, according to Statistics Canada, a Canadian federal government agency. That continues a year-long trend that might not abate anytime soon: a September survey by The Harris Poll for the Travel Health Insurance Association of Canada showed only 26 percent of 1,500 surveyed Canadian adults would consider a trip to the U.S. through March 2026, down from 41 percent one year prior.