.png)
The travel industry was one of the hardest hit by the pandemic, with lockdowns, quarantines, and work-from-home mandates keeping people off of public transportation and flights. Business travel came to a halt, convention centers shut their doors, and public transit ridership took a dive as people became increasingly aware of social distancing. And though travel began to increase around July 2021, the swiftly rising inflation and cost of living upended the budding recovery. After many stops and starts, COVID-19 surges, and inflationary pressures, how has traveler behavior shifted?
This white paper digs into the foot traffic data to understand the implications of these changes. We looked at two categories of business travel – frequent commutes, including transportation to and from the office, and more infrequent travel related to out-of-town business meetings and conventions. By analyzing visit trends to airports, public transportation hubs, convention centers, and offices, this report reveals how traveler behavior has evolved over the past three years. With the pandemic fading in the rearview mirror, we examine how business travel and commutes look in the new normal and try to predict what lies ahead for the industry.
To get a preliminary sense of the changes to the business travel landscape over the past three years, we analyzed four major travel sectors – airports, trains and buses, convention centers, and hotels. Foot traffic to these segments had ups and downs pre-pandemic, with airports and hotels showing fairly similar visitation trends, while visits to convention centers and bus and train stations showed different patterns. However, all four sectors were almost identically affected by the pandemic, with foot traffic plummeting in early 2020.
But these industries are rallying, for the most part, with some travel categories recovering their pre-pandemic foot traffic patterns while others still lag. Hotels have seen the strongest recovery, with consistent summer visit spikes and only minor downward trends in the inflation-marked fall and winter of 2022. Similarly, airports have seen their visits exceeding a January 2019 baseline for much of 2022. Like hotels, however, airports also saw their traffic slow in late 2022 as the ongoing inflation led some would-be travelers to opt for alternative modes of transportation.
Buses and trains, meanwhile, experienced more dramatic lags in visit trends, as the persistent shift to hybrid work kept many people from using public transportation as frequently as they once did. The introduction of hybrid conferences – which offer both in-person and virtual attendance options – also seems to have impacted convention centers, which have also seen their visits remain stubbornly below 2019-levels.
Office occupancy was dramatically impacted by COVIDand the sector has been one of the slowest to recover its pre-pandemic foot traffic. While many speculated (or perhaps hoped) that post-pandemic, people would head back to the office five days a week, the reality has been far more complex. Convincing workers to give up on their hybrid or remote work arrangements has been a hard sell, one that is reflected in visit data from the Placer.ai Office Building Index.
Across the country, both visits and visit frequency are still significantly lower than they were in 2019 – although the office recovery is following different paths in different cities.
The index shows that foot traffic to offices is still far lower than it was before the pandemic. Across the country, both visits and visit frequency are still significantly lower than they were in 2019 – although the office recovery is following different paths in different cities.
San Francisco, CA, for example, saw an average of 71.0% fewer visits to its office buildings in 2022 than in 2019, while visit frequency was 47.5% lower for the same period. In contrast, New York City, NY saw its office visits down by 44.4% year-over-three-years (Yo3Y: 2022 compared to 2019). However, none of the analyzed cities have come close to exceeding their pre-pandemic visit patterns.
The slow office recovery has significantly impacted workplace-adjacent businesses and services, including public transportation. With monthly visits to office buildings remaining low relative to 2019, bus and train stations are also seeing their foot traffic lag behind pre-pandemic levels. As many commuters choose public transit to arrive at the office, the persistent Yo3Y public transportation foot traffic gaps are not surprising and likely impacted by the overall slow pace of the office recovery.
In contrast, gas stations and convenience stores, typically geared toward private car ridership, show an entirely different trend. Aside from a minor dip during the first lockdown-heavy months of COVID, the space has seen a dramatic growth in visits, with 29% more visits in January 2023 than in January 2019. This growth may indicate that some people who chose to drive rather than risk a crowded subway car or bus during the pandemic have not yet returned to public transportation. The data may also mean that more people are using their car for recreation rather than commuting to work, which means more time to stop at convenience stores for snacks along the way to and from their destination.
This fundamental shift in how often people go into the office and the rise in private car usage work in tandem to explain the slow recovery of public transportation. Most people are going to the office less frequently than before the pandemic – and when they do go in, many are potentially choosing to drive rather than take public transportation.
To better understand just how much office commuting patterns have changed, we looked at traffic data from inter- and intra-city public transportation hubs in Chicago, IL, Boston, MA, New York City, NY, Dallas, TX, and Washington, D.C. In all five cities, the share of travelers arriving at the analyzed station directly from work has decreased since 2019. Pre-pandemic, 24.7% of people arriving at the Ogilvie Transportation Center in Chicago, IL – one of the busiest commuter rail transportation hubs in North America – came directly from their respective workplaces. In 2022, that number was 15.3% – a 38% decrease.
The share of travelers arriving at major train stations directly from their workplace has decreased since 2019.
Similar patterns repeated themselves in Boston, MA (from 23.1% in 2019 to 11.0% in 2022), New York City, NY ( 22.5% to 13.0%), Dallas, TX (16.7% to 5.6%), and Washington, D.C. (16.3% to 8.6%), highlighting the decrease in workers at offices and their nearby transportation hubs.
This could be attributed to employees embracing remote or hybrid work options or to a newfound preference for driving to work for those who now only have to make the trip a few times a week. At the same time, some of the drop may be due to an increase in office-goers stopping by a coffee shop or store on their way back to the train, as trips to the office might feel like a bigger outing now that most employees are not going in as often.
The decrease in commuter travel is not the only change the pandemic has had on public transportation. Zooming into the captured market of major transportation hubs across the country shows that median household income (HHI) of travelers to major commuter hubs was lower in 2022 than in 2019. (The captured market analyzes the demographics of transportation hubs’ trade areas weighted according to the visit share of the various census blocks making up the trade areas).
This change in the median HHI of public transportation consumers may be due to the nature of different workplaces and their amenability to remote work. Many higher-paying, white-collar jobs are more easily done from home, while many service oriented jobs that require an in-person presence– such as shift work in retail, food service, and hospitality – tend to be lower paying. The increase in private car usage might also be contributing to the decrease in the average HHIs of visitors to public transportation hubs: Higher-income workers may have easier car access and less concerns about filling up the tank for their journey to work.
Although fewer office workers are using trains and buses to commute on a daily basis, public transportation still renders a critical service – although its function may be shifting.
Between 2019 and 2022, the share of weekend visits to major train stations across the country increased dramatically
Between 2019 and 2022, the share of weekend visits to major train stations across the country increased dramatically, indicating that many are now visiting these transportation hubs for recreational rather than professional purposes. Some cities are already implementing schedule changes to adapt to the new normal – in December 2022, New York City’s MTA announced plans to bulk up weekend services on some lines while making cuts to Monday and Friday services.
The changes in office and public transportation visit patterns over the past few years reveal the new normal in commuting and urban travel. There is a decrease in foot traffic to office buildings and commuter hubs, but an increase in private car usage. Still, public transportation remains a crucial lifeline for many workers – especially lower-income employees – as well as an important transit option for weekend revelers.
The pandemic heavily affected business travel, with lockdowns and mandatory quarantines making traveling to conferences or business meetings extremely difficult. But convention centers have seen a resurgence of late, with some even expanding in size in anticipation of a conference comeback. Still, visit data indicates that foot traffic to convention centers is still lagging behind 2019 levels, as a combination of hybrid attendance options and tighter corporate travel budgets kept the space from making a full recovery in 2022. So what lies ahead for the convention space in 2023?
Convention centers have seen a resurgence, but foot traffic to convention centers is still lagging behind 2019 levels.
The height of the pandemic saw most conferences and business events going virtual as gatherings became impossible. However, as seen time and again, people crave in-person interactions and experiences – leading to an initial convention center recovery in the spring of 2021 as vaccine availability increased and air travel became less daunting. By June 2022, the Yo3Y convention center visit gap had narrowed to 14.6%, and in December 2022 the Yo3Y visit gap stood at just 14.2%. Still, looking at the chart below also highlights the persistent challenges in the space – as of January 2023, convention center traffic has yet to reach – let alone exceed – pre-pandemic levels.
This persistent visit gaps could be due to the increasing popularity of hybrid conferences – events held in person with virtual formats that allow people to attend remotely – and may indicate that a new normal has been reached in the space. But the stalling recovery may also be due to temporary setbacks related to the wider macro-economic situation, which is driving many large companies to reign in their travel budgets until the current headwinds blow over.
But some estimates predict that travel budgets may return to pre-pandemic levels sooner than expected, with much of that investments directed towards attending larger conferences and trade shows. It seems, then, that this year (2023) will be critical to determining whether the lingering visit gaps are due to continued challenges in the space or whether convention centers – like the office space – have entered a new normal.
The Consumer Electronics Show, the largest technology show in the world, provides a glimpse into the evolving attendance patterns over the past four years.
The show takes place every January in Las Vegas, NV and in 2019, the conference attracted attendees from all across the country. In 2022, however, the audience was significantly smaller, likely due to COVID surges and the option to attend the conference virtually. Where CES 2019 attracted 175,000 visitors, only around 40,000 attended in 2022, with fewer attendees from rural trade areas.
The most recent CES in January 2023 saw a modest increase in representation from a wider range of locations, including North Dakota and Nebraska, compared to the previous year. Attendance also increased, with around 100,000 people attending – roughly 70% of 2020’s numbers.
Another noticeable shift in business travel is the decrease in the share of frequent airport visitors. The share of individuals who visited airports at least five times per year declined during the pandemic and was still below pre-pandemic levels in 2022.
Much of this decrease in visits is likely due to the lingering effects of the pandemic and the ease with which people can meet virtually. But the decline can also be attributed to businesses looking to cut costs in a challenging economic climate. As companies continue adjusting to a post-pandemic world and ramp up their travel budgets in 2023, convention centers may well still make a full recovery.
It’s easy to point to any one industry and highlight how the pandemic fundamentally changed it. The “new normal” is still in flux, and the wide-ranging world of business and everyday travel has not entirely found its equilibrium. Sweeping shifts in behavior have affected how people get to work, the time of day they travel, and whether they choose to attend meetings and conferences in person or not – and these changes are not set in stone. As seen over the past few years, consumer behavior tends to shift alongside new changes, whether driven by economic factors or health concerns.
And perhaps the way forward is through adapting and making the best of the new normal. New York City’s MTA shifted its train schedule to better accommodate increased weekend travel, and the CES show continued in the hybrid format it debuted in 2021. By embracing change and finding innovative solutions, travel can thrive under this new reality.
Foot traffic to major transport categories is rallying – but not fully recovered just yet. Hotels and airports were heading towards a full recovery, but visit growth slowed as inflation took hold. Meanwhile, public transportation and convention centers have taken longer to catch up to their pre-pandemic foot traffic, likely driven by the popularity of remote work and hybrid conferences - though overall recovery trends for both have been significant.
The change in office work has had wide-reaching impacts on traveler behavior. The availability of remote work has impacted major commuter hubs near office blocks nationwide. Foot traffic to bus and train stations is still around 20% lower than pre-pandemic levels, and an increase in visits to convenience stores and gas stations suggests that many are choosing to travel by car post-pandemic.
People are using public transportation more recreationally. The share of weekend visits to major train stations across the country has increased dramatically while the share of weekday visits have gone down, suggesting that many are using trains for recreational purposes instead of for a work commute.
2023 will be critical to the convention center recovery. Convention centers have seen a marked increase in foot traffic from the height of the pandemic. But the foot traffic recovery has stalled through much of 2022, likely due to a combination of an increase in virtual and hybrid events and tighter corporate travel budgets. As many companies ramp up their travel budgets this year and focus spending on larger events, this year is likely to be critical to the convention space’s recovery story.
