WASHINGTON—The coronavirus will cost the U.S. travel sector 4.6 million jobs by the end of April, according to an updated analysis released by the U.S. Travel Association .
Earlier projections released by U.S. Travel foretold catastrophic losses of $355 billion and 4.6 million travel-related jobs this year. But the latest data shows that $202 billion in direct travel spending and all 4.6 million jobs will disappear before May.
The report, conducted by Oxford Economics, found that for 2020, expected spending losses in the lodging sector will be $74.4 billion, while 670,000 jobs will be lost.
The numbers highlight the need for aggressive and immediate action by the federal government, travel leaders say. The non-airline travel sector is seeking $250 billion in disaster relief to avoid putting millions of Americans out of work.
“The news we have for policymakers and the public is very challenging: the 15.8 million American jobs supported by travel are directly in the crosshairs of the health crisis, and the only thing that’s going to protect them is aggressive financial relief right now,” said Roger Down, U.S. Travel president and CEO, who on Tuesday presented the economic impact projections and the travel industry’s relief request to President Trump and Vice President Pence at a White House meeting.
Dow continued: “There are countless stories of travel businesses—83% of which are small businesses—working hard to do right by their workers. But the cold reality is they can’t support their employees if they don’t have any customers, and they don’t have any customers because of the actions needed to halt the spread of the coronavirus. Millions of Americans shouldn’t have to lose their jobs by acting in the interest of public health.
“We’re witnessing the shutdown of travel. The economic effects of that are already disastrous, but could become worse and permanent unless the government acts now,” he said.
Relief measures requested by U.S. Travel on behalf of the industry include establishing a $250-billion Travel Workforce Stabilization Fund to keep workers employed; providing an Emergency Liquidity Facility for travel businesses to remain operational; and bulking up and streamlining the SBA loan programs to support small businesses and their employees.
The report analyzed two scenarios for shortening the duration of losses:
Scenario 1: Full recovery begins in June, where each month from June to December offers a potential average gain of $17.8 billion in GDP and $2.2 billion in taxes. The total benefits would tally $100 billion in travel industry revenue, $15 billion in taxes, and 1.6 million jobs restored.
Scenario 2: 50% recovery begins in June (relative to expected performance), where each month offers a potential gain of $8.9 billion in GDP and $1.1 billion in taxes.Total benefits would tally $50 billion in travel industry revenue, $7.7 billion in taxes and 823,000 jobs restored.