Holiday travel expected to be a bright spot in an otherwise dull economy

Despite reams of gloomy economic news, Labor Day travel could provide a bright spot as more than 34 million people are expected to travel for the long holiday weekend.

Weekend travel is expected to increase 9.9 percent over the holiday last year, which was one of the worst showings since 2000, according to the AAA. Last year, 31.3 million people hit the road for summer's final weekend, which was only lower in the past decade in 2006 when 30.6 million people traveled.

ADVERTISEMENT
AAA officials are crediting the better economy, even one that's slowly improving, with providing a boost to travel numbers after last year's slump.

"A strong recovery in travel is anticipated after last year, when Labor Day travel tumbled more than 30 percent from 2008," the AAA said in a release.

Travel hit a record high in 2008 when 45.1 million people were on the move for Labor Day, by far the highest level in the past decade with only 2003 in the 40-million range at 41.6 million.

"While job growth has been disappointing, gross domestic product, household net worth and consumer confidence have increased, while consumer debt has decreased," the AAA said. "The U.S. travel industry began to gain traction in the fourth quarter of 2009, and that momentum has continued this year."

AAA estimates if Labor Day was earlier in the month, traveling would have mustered a 10 percent increase.

Overall, travel has increased during the year and through the summer.

The hotel industry reported increases in year-over-year numbers through the end of August with occupancy up 10.6 percent, average daily rates up 2.4 percent and room revenue up by 13.2 percent over last year, according to Smith Travel Research.

At the start of the summer season, 66 percent said they were planning a vacation this year, up a smidge from 2009.

If the national parks are serving as a barometer, 2010 is shaping up as a nice improvement for the travel industry.

Although visitation to the parks is lower this year compared with 2009, matching last year's numbers would be a "big deal," National Park Service spokesman Jeffrey Olson told The Hill.

The park service had 285.6 million visitors last year, up 3.9 percent from 2008, boosted by two factors — the Obama inauguration — which added 1.5 million visitors — and the reopening of the Gulf Islands National Seashore off the coast of Florida, which boosted visitor numbers by 1 million, Olson said.

The Gulf of Mexico oil spill has affected the park and possibly lowered this year's visits, Olson said.

So far, more than 165 million have visited the parks this year, down about 3 million from last year. But Olson expected  the parks could very likely turn in solid August numbers, especially with two fee-free days in the month.

Three out of the five busiest parks in the country have seen increases in visitors through July — the Great Smoky Mountains National Park is up 130,000, Yosemite is up 103,000 and Yellowstone has seen an increase of 110,000 so far.

The parks offer an affordable alternative with inexpensive camping options and a one-price per carload fee of about $15-$20 for up to seven days in the park. The parks also are within driving distance in many regions. With 91 percent of travelers expected to drive this Labor Day, a 10.3 percent from last year, the parks are a viable option.

Lower gas prices for the holiday should provide a few extra dollars for travelers to spend on shopping and dining.

At last check, gasoline prices averaged $2.68 a gallon, down about 6 cents from $2.74 a gallon a month ago. A year ago, gasoline was $2.60 a gallon, according to the AAA Daily Fuel Gauge Report.

No price spikes were expected because there's an adequate supply of crude oil.

Spending also is expected to rise this year, according to a AAA survey, with median spending expected to be $697 this Labor Day, nearly $50 more than last year when median spending was estimated at $650. Dining (63 percent); shopping (47 percent) and visiting with friends and relatives (43 percent) were named as the three top primary activities by travelers.

Consumers will be paying more as AAA predicts this year's airfares will be about 9 percent more expensive than during the 2009 holiday weekend, weekend daily car rental rates will be about 7 percent more and hotel rooms will cost between 2 percent and 6 percent more.

While driving makes up the majority of the market, about 5 percent of travelers will fly to their destinations, an increase of 4.6 percent from one year ago.

This is viewed as a fairly strong revival given that the number of Labor Day air travelers plunged more than 33 percent in 2008 and a further 15 percent in 2009, AAA said.


More in Finance

Poll: Americans ready to open wallets for holiday shopping

Read more »