COVID-19 takes financial toll on travel and hospitality industries
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Marriott International will announce quarterly earnings after U.S. markets close Wednesday. Analysts will be watching for signs of how this and other companies in the travel business are managing the fallout from COVID-19.
Hilton has closed at least 150 hotels in China. Intercontinental Hotels Group reported similar numbers. And Marriott — with its more than 400 hotels there — is vulnerable too, according to Jan Freitag, senior vice president of lodging insights at STR.
“For the publicly traded companies who have exposure in China, obviously they are going to get probably pretty bad news going forward just because hotels are likely going to be closed,” Freitag said.
It’s not just companies in China feeling the strain. Adam Sacks, president of Tourism Economics, said that in the 2003 SARS outbreak, travel from China to the U.S. fell by 30% and took years to recover.
A similar decline now could reduce spending here by $10 billion in flights, lodging, retail and entertainment.
“The main difference is that China is such a bigger market now,” Sacks said. “In 2003, there were only about 200,000 visitors from China to the U.S. Last year, there were nearly 3 million — so the stakes are much, much higher.”
COVID-19 Economy FAQs
What’s the outlook for vaccine supply?
Chief executives of America’s COVID-19 vaccine makers promised in congressional testimony to deliver the doses promised to the U.S. government by summer. The projections of confidence come after months of supply chain challenges and companies falling short of year-end projections for 2020. What changed? In part, drugmakers that normally compete are now actually helping one another. This has helped solve several supply chain issues, but not all of them.
How has the pandemic changed scientific research?
Over the past year, while some scientists turned their attention to COVID-19 and creating vaccines to fight it, most others had to pause their research — and re-imagine how to do it. Social distancing, limited lab capacity — “It’s less fun, I have to say. Like, for me the big part of the science is discussing the science with other people, getting excited about projects,” said Isabella Rauch, an immunologist at Oregon Health & Science University in Portland. Funding is also a big question for many.
What happened to all of the hazard pay essential workers were getting at the beginning of the pandemic?
Almost a year ago, when the pandemic began, essential workers were hailed as heroes. Back then, many companies gave hazard pay, an extra $2 or so per hour, for coming in to work. That quietly went away for most of them last summer. Without federal action, it’s mostly been up to local governments to create programs and mandates. They’ve helped compensate front-line workers, but they haven’t been perfect. “The solutions are small. They’re piecemeal,” said Molly Kinder at the Brookings Institution’s Metropolitan Policy Program. “You’re seeing these innovative pop-ups because we have failed overall to do something systematically.”
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