By David Jones
NEW YORK -- The Travel Business Roundtable, a group of more than
70 chief executives of major travel- and tourism-related companies,
unveiled a monthly index designed to gauge the strength of the
travel industry.
The TBR Index of Leading Economic Indicators is an index of
government and industry data designed to compare the industry with
the overall U.S. economy. The index, developed by economist James
Howell, former chief economist of the Bank of Boston, includes data
such as monthly travel agent sales from the Airlines Reporting
Corp.; revenue passenger miles from the Air Transport Association;
daily mileage and travel figures from the car rental industry, and
room occupancy percentages and room revenue figures from Smith
Travel Research. The index also includes several figures from the
U.S. government, including personal consumption of services,
transportation employment in airline and travel agent industries
and retail sales in bars and restaurants.
The index is a weighted measure of the increase or decrease in
travel-related activity compared with the prior month, officials
said. Based on the activity measured from May 1996 to May 1997, the
travel industry has had monthly increases as high as 2.4%, in
January 1997, and decreases as steep as 1.1%, in September 1996.
Howell said a monthly increase of more than 1% should be considered
a strong month for the industry.
During that same period, the U.S. Index of Leading Economic
Indicators rose only as high as 0.5% and fell below zero only once,
by 0.1%. The U.S. index takes into account 10 measures such as
average weekly hours in manufacturing, new manufacturing orders and
vendor performance.
Howell said that the performance of travel industry companies,
including travel agencies, should not lag too far behind the
performance of the overall index if they are running their business
successfully. "An individual company shouldn't be moving in
significant disparity to that straight line," Howell said.
Jonathan Tisch, chairman of the Roundtable and president and
chief executive of Loews Hotels, said the TBR Index should be seen
by the government as evidence that the travel and tourism industry
is a significant contributor to the U.S. economy. "It is vital that
elected officials and business analysts take note of the economic
impact of this industry by closely watching the new TBR Index, " he
said.
Tisch said the group will release the TBR Index two days after
the release of the U.S. index each month.