When Travel Returns, Will You Be Able To?

March 9, 2021 Marsha Mowers

For some, travel is a fun thing to look forward to every winter.  Dollars are saved, time off is booked so we can escape for a week and return to our normal lives with memories and anticipation to do it again next year.

For others, travel is a necessity.  It could be part of their job (as it is in my case), or a need to visit a sick or dying relative or maybe it’s an emotional need to satisfy the sense of wanderlust so many of us have.

Whatever the reason for travel, when demand starts to surge again, there are going to be many factors in place that determine who can travel; a major one being cost.

In January 2020, before the pandemic, Maclean’s magazine reported that after “years of stable or even declining base fares — which, it’s important to note, don’t include all the extras airlines ding customers with, like baggage, seat selection and ticket change fees — the cost of airline tickets is rising at the fastest pace in nearly a decade.”

Travel experts in that article warned travellers to “buckle up for more fare increases in the year ahead.”

That was pre-pandemic, before the travel industry took a massive, devastating hit.

Add in the economic impact of the pandemic on households and the question could become, will the average person be able to afford to travel or will travel be a perk enjoyed only by those with higher incomes?

During this pandemic, many people lost their jobs, but there are many who thrived.

According to a February 2021 CIBC Economics report based on Statistics Canada data, Canadians who lost their jobs due to the recession sparked by the COVID-19 pandemic all had something in common: They made $27.81 an hour or less. The biggest decline in work was among the country’s very bottom wage earners, with an hourly wage under $13.91.

Yet higher income Canadians did okay. The biggest job growth was among those at the very top of the pay scale, earning an hourly wage of $41.73 or more, CIBC said.

The cost of travel will come down to the basic economics of supply and demand.

We’re entering a perfect storm really.

There are a year’s worth of travellers who, in most cases, got an FTC (future travel credit).  They are looking forward to finally enjoying their trip. In many cases it could even be a group such as a destination wedding (think bums in seats).

A traveller making a new booking will be competing for a spot on the same planes as a year’s worth of travellers who have future travel credits.

According to the latest Longwoods International tracking study of American travellers taken on March 3, 84% of those surveyed have travel plans in the next six months, the highest level since the early days of the pandemic a year ago. This is the third consecutive wave showing over 80% for this key question.

In normal circumstances, that likely wouldn’t be a problem. An airline or tour operator could change the type of plane to a larger one or accommodate everyone on one of its multiple, in most cases, daily, flights.

But the travel industry is operating on a skeleton crew. Airlines are operating at 96% less capacity, which means a lot less flight options currently. It will take time to rebuild as re-certifications are needed for airline crews. Hotel staff in destinations also need to be brought back and trained on new protocols after being furloughed.   That’s not going to happen overnight.

The good news is that prices are for the most part, still low.  The surge hasn’t fully hit yet.  But it’s coming.

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