As Covid-19 locked down countries around the world, it also meant that travellers were locked out. Now, however, we're moving into the post-pandemic era. The policy being taken by many governments is one of learning to live with Covid-19. And it's long-awaited news for the global travel sector. Many public health restrictions are being relaxed and, perhaps more importantly, borders are reopening. So, the path to recovery is well and truly underway for travel brands.
What the pandemic meant for the sector
All sectors felt a severe impact from the emergence of the pandemic in early 2020. All but the most essential businesses were forced to close or shift their employees to remote working. For the travel sector, the nature of lockdowns meant the market simply collapsed. For business or pleasure, no-one could travel from country to country without a compelling cause.
By early 2021, it was estimated that Covid-19 had cost the global tourism sector a mammoth $935 billion. Even though some countries started to unlock their borders earlier than others in 2021, those losses continued to climb as it still wasn't business as usual. On top of that, many countries reliant on inbound tourism suffered a big economic hit as travellers were kept away.
How badly was global travel affected
With such unique circumstances stacked against the sector, a lot of operators faced a battle to survive. Some smaller firms went out of business, while others – including some huge names – filed for bankruptcy or administration. The knock-on effect is that workers lost their jobs, while third-party suppliers in other industries lost important customers.
For those keeping an eye on the forex market and companies' stock values, it was obvious to see which companies were feeling the pinch. If nothing else, millions of dollars were sheared off the values of major travel stocks. Trader confidence in companies as diverse as hotel operators and airlines was diminished as the sector had no room in which to manoeuvre.
What are the current prospects for travel
The pandemic was a real nadir for the travel sector. But the current prospects now seem rosier – albeit with the caveat that rising fuel prices and growing cost of living are making the path to recovery a little longer. The countries that had favoured a zero-Covid strategy are now learning to live with the virus. Now, travellers can return to places such as Vietnam and New Zealand.
There's an undoubted thirst for travel among those who have been kept at home for two years. More people are starting to book flights, accommodation, and other travel-related goodies. It is both a reflection of this desire to get away from it all and greater confidence in safety measures being adopted by operators. Yet, numbers are still to reach the levels they were pre-pandemic.
The danger to the travel sector now is less the resurgence of Covid-19. Instead, it's that caveat – the rising cost of fuel or a squeeze on disposable income. For the operators that survived the worst of the pandemic, a rapid recovery would be ideal. But, if it does take longer, perhaps that resilience that saw them through the last two years will continue to stand them in good stead.