Fallout from the Covid-19 coronavirus will be six times
worse for the travel industry than the terrorist attacks of 9/11, a new report
from Tourism Economics estimates.
The analysis, which the U.S. Travel Association said it
presented to the White House on Tuesday, forecasts the virus and the resulting
restrictions will inflict a $809 billion hit on the U.S. economy. The travel
industry will be hit harder than any other sector, resulting in the loss of 4.6
million travel-related American jobs this year.
Total spending on travel in the U.S. -- including
transportation, lodging, retail, attractions and restaurants -- is projected to
plunge by $355 billion for the year, a 31% decrease. That is six times greater
than the impact of 9/11, the report said.
Additionally, the analysis said, estimated losses by the
travel industry alone are severe enough to push the U.S. into a protracted
recession, and the projected 4.6 million travel-related jobs lost would nearly
double the U.S. unemployment rate.
U.S. Travel CEO Roger Dow said after a meeting with President
Trump, Vice President Pence and Commerce Secretary Wilbur Ross that the industry needs several
hundred billion dollars in direct grants. The message from the president, he
said, was that he will “act big, fast and immediate.”
“We are facing a catastrophe that is sudden and needs to be
fixed suddenly,” Dow said. “We need a workforce stabilization fund across the
board, and fast, for the entire industry.”
Dow also said, “This situation is completely without precedent. For the sake of the economy’s long-term
health, employers and employees need relief now from this disaster that was
created by circumstances completely out of their control.”
In the meeting with the president, travel leaders proposed relief packages for the
travel sector that would provide aid for both employees and small-business
owners. A proposed $150 billion package would be for the lodging sector, much of which is comprised of small businesses.
Dow said 83% of all travel employers are small businesses.
“Travel-related businesses employ 15.8 million Americans,
and if they can’t afford to keep their lights on, they can’t afford to keep
paying their employees. Without aggressive and immediate disaster relief steps,
the recovery phase is going to be much longer and more difficult, and the lower
rungs of the economic ladder are going to feel the worst of it.”
Dow also pointed out how travel is an engine that drives other parts of the economy.
“What happens when people travel, it’s where sales deals are
drawn, products are sold and it actually has tentacles through the entire
economy,” he said. “So if travel stops, basically the economy stops because we’re
so tied together. It’s so important to understand that if you peel the
onion, so many other things are attached when people, especially for business,
make a trip.”
Jeri Clausing contributed to this report.
This report was updated on Tuesday evening with additional quotes from Roger Dow and a clarification that a proposed $150 billion rescue package would be for the hotel industry alone.