The Great Resignation Effects on Travel

First seen last summer, the cultural phenomenon dubbed the “Great Resignation” has crept across almost every industry, resulting in powerful numbers we've never seen before. In February alone, 4.4 million Americans, or about 2.9% of the workforce, quit their jobs.

The World Travel & Tourism Council (WTTC), representing the global private Travel & Tourism sector, revealed an analysis, conducted in partnership with Oxford Economics, of staff shortages showing a U.S. labor shortfall of almost 700,000 workers during 2021. And for 2022, projects up to one in 13 jobs will remain unfilled.

The continued labor shortage in the Travel & Tourism sector negatively impacts every travel industry supplier, including airlines, lodging, restaurants, and ground transportation. According to one recent Wakefield and SAP Concur study, 100% of respondents said the Great Resignation had impacted their business.

Great Resignation labor shortage impacts travel industry customer service

One of the most notable shortages in the Travel & Tourism sector is the lack of customer-facing staff. As many travel restrictions ease, taking a trip may seem somewhat “normal.” However, the labor shortage means there are not enough employees to meet the pent-up demand.

I experienced this firsthand while checking into a hotel during a recent business trip to Orlando, FL for the SAP Concur Fusion Conference. It was evident there was a significant lack of staff, and many of the retail shops were shuttered. And while supply and demand are set to adjust gradually throughout 2022, this issue is likely to remain.

Great Resignation and the emergence of pilot shortages and canceled flights

A “perfect storm” of factors has created a pilot supply shortage of global proportions for the aviation industry. For many, what once seemed like a stable and lucrative career path, now looks much less secure. It's believed that 25,000 to 35,000 current and future pilots may choose an alternative career path over the next decade. In fact, according to a recent Oliver Wyman study, the U.S. alone will face a pilot shortage of over 12,000 in 2023.

Without a doubt, we’ve all experienced the impacts of the work shortage. During the Memorial Day weekend this year, over 2,500 flights were canceled. And almost every major airline in the U.S. has announced they’re preemptively removing thousands of flights from airline schedules this summer in the face of staffing and other issues.

Suppliers with staff shortages, cancelations, reduced inventories, longer wait times, ever-increasing prices, etc., are the kind of disruptions travelers can continue to expect for the remainder of 2022 and into 2023.  

For those of us in corporate travel, we should be asking ourselves these questions:

• What other short- and long-term effects will arise in the wake of the Great Resignation?
• Is a wave of higher costs looming that will have to be passed onto us by travel suppliers who must compete for new hires demanding higher wages?
•  Will suppliers continue to curtail services due to a lack of customer service employees?
• If the traveler experience declines due to the burdens of travel shortages, will this further increase the use of virtual solutions instead of travel?

One thing is certain – as the business travel landscape continues to change, we must come together to navigate new travel supplier challenges and increasing inflation. The coming months will be a time of opportunity to strengthen relationships, explore new ways of thinking, and demonstrate the ability to adapt and excel in a changing world.