Americans are packing their bags and flooding airports, eager to enjoy their summer vacation.
But the travel industry is struggling to keep up with the demand, and passengers are paying for it — big time, according to Ted Rossman, Bankrate’s senior industry analyst.
Roughly 77% of Americans have hit snags like canceled flights or long waits, according to a new Bankrate Survey. “It’s been a pretty bumpy summer for air travelers,” Rossman said in an interview on Yahoo Finance Live (video above).
“This airline industry is still having trouble keeping up. They’re not all the way back to pre-COVID staffing levels,” he said.
Travel has rapidly increased post-COVID. According to Bankrate, “63% of U.S. adults have traveled or plan to travel for leisure in 2023.” Similarly, “58% of U.S. adults planned to travel for leisure or already had traveled by July 2022.”
“I’m really surprised, to be honest. I thought last year was the year that everybody got the so-called revenge travel out of their system, all this pent-up demand that stacked up during the pandemic,” Rossman said. “Domestic travel was very strong last summer.”
Rossman added that overseas flights were likely behind the continued boom.
“One thing that’s new about this year is that international travel is really all the way back. And last year, we still had a lot of lingering COVID restrictions abroad,” he said. “Now that those have come down, people are taking the long-awaited bucket list trip to South Africa, let’s say, or Europe, or Asia, or other destinations around the globe. So that’s one thing that’s unique.”
The airline industry, meanwhile, is struggling with equipment and air traffic controller shortages, Rossman said. Passengers are complaining they’re dealing with “higher prices than they’re accustomed to (53 percent), long waits (25 percent), poor customer service (24 percent), canceled or disrupted plans (23 percent) and hard-to-find availability (23 percent),” according to the Bankrate study.
“You throw in this robust demand, and then any sort of computer glitch or weather problem, we’ve had a lot of thunderstorms marching across the country, it just kind of cascades from there,” Rossman said. “So people want to travel but they’re having to put up with high prices and a lot of delays, unfortunately.”
But that, along with inflation on everything from food to housing, has had little impact, it seems, on demand. In fact, many consumers remain willing to dole out even more money on travel — the price of eggs aside. According to the Bankrate study, “28% of leisure travelers plan to spend more in 2023 than they did in 2022.”
“I think people are also showing that they’re willing to prioritize experiences. So even as they cut back on spending on physical goods, people are putting things like travel and dining at the top of the list,” Rossman said. “So this pent-up demand has more room to run than I would have predicted.”
Dylan Croll is a Yahoo Finance reporter.
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