Seize the Gray: Planning for Uncertainty Key to COVID Recovery
By Clayton Reid CEO, MMGY Global | July 05, 2020
In my career, never have I seen a world event like COVID-19 – it's societal impacts at a scale and magnitude that are hard to grasp. History will judge how this has been handled by government, medical experts, corporate interests and the citizen consumer.
In the midst of this pandemic, June protests across the country now also call attention to a pronounced socio-economic gap being driven wider in ways that further disenfranchise many in our country. So, we see in this moment a test of everything from human character to socioeconomic Darwinism to the possibilities of global collaboration.
And one thing is certain: People are suffering both personally and economically, and in the end, they need support and help from government and industry. I hope we will look back at the events of 2020 as a turning point; as a time when we made American life better for business and the people that make business work.
Travel and hospitality can play a crucial and transformative role in this recovery and healing. Our industry will stimulate job creation, economic activity and social empathy so let's take a look at the future through that lens.
First, no industry has suffered more – at both ends of the socioeconomic scale. In the U.S. alone, 9 million hospitality and travel workers have lost their jobs – by far the most of any global industry. Roughly 51% of travel-related jobs disappeared almost overnight. At the same time, hotel owners, real estate companies and public travel brands have seen catastrophic losses, leading to investor insecurity and some companies facing bankruptcies. Hertz, which has been in business for more than 100 years, is one of them.
Our industry faced the first and most significant brunt of the damage, with billions in revenue gone and a lodging industry looking at the reality of 50% declines in RevPAR and single-digit April occupancies. The year of 2020 is likely to end with system-wide occupancy below 50%, many smaller owners in peril and millions of hospitality workers caught in the middle.