One in three holidaymakers will cut spending next year due to the cost of living crisis, according to travel industry research.
Travel association Abta said a strong recovery in travel demand this year is likely to continue into next year, but its own surveys suggest people are opting for cheaper trips and cutting spending.
Abta said twice as many Britons holidayed abroad in the past year than in 2021, after pandemic travel restrictions were lifted, and accounted for up to 70% of 2019 figures – this which he said was a significant recovery with UK travel restrictions only lifted in March this year. .
According to his research, only 4% of those who have traveled this year have ruled out another trip next year for financial reasons – and 61% of all respondents will take a holiday abroad. But 35% will reduce their spending and opt for cheaper trips.
The research was conducted in late August, ahead of the Kwasi Kwarteng mini-budget which hit the pound and fueled expectations of higher interest rates, higher mortgage costs and lower incomes available.
“The current ‘turbulence’ in the financial markets – to use our chancellor’s nonchalant description – is a real cause for concern for our members,” Abta Chief Executive Mark Tanzer said at the Marrakech Travel Convention. .
“Rising interest rates on top of rising energy bills are putting double pressure on businesses – rising costs just as consumers are tightening their belts.”
He added: “Many travel businesses have emerged from the pandemic with less financial headroom than they entered it, so increasing borrowing at higher costs is not an option.”
In its Holiday Habits report, Abta said it noted an increase in the number of people booking through agents or travel professionals in 2022 compared to 2019, after many people suffered problems with canceled trips during the pandemic. There has been a particular increase in demand for such services from families, with more than half of those with young children booking this way.
However, Tanzer said the lifting of UK travel restrictions had “triggered an increase in holidays abroad, with almost twice as many people traveling abroad in the six months from March to August. 2022 than in the previous six months”.
He said reaching 70% of 2019 levels was “pretty remarkable” after the Omicron restrictions – although 39% of travelers were on a modified or delayed trip.
Tanzer said: “We now face an uncertain year given cost of living challenges, but Abta’s research suggests we should continue to see an increase in overseas holidays next year.”