As of Early 2003, Traveler Concerns Regarding Safety, Security and Inconvenience Outweigh Economic Concerns According to PricewaterhouseCoopers

NEW YORK, Security concerns and inconveniences faced by travelers are having a continued effect on lodging demand even with the end of the primary military action in Iraq and signs of an improving national economy.

PricewaterhouseCoopers estimates that these traveler concerns are significant enough to have caused 30 to 40 percent, varying by quarter for the last seven quarters, of total occupancy loss experienced by the lodging industry. In the first quarter of 2003, the "concerns effect" increased to 60 percent of the total occupancy loss, as the effect of the economy has diminished and traveler concerns have continued.

"Even with the expected improvement in economic conditions, this 'concerns effect' will remain, and in 2003 will result in occupancies being approximately two percentage points below where it would otherwise be," said Bjorn Hanson, Ph.D., global industry leader, PricewaterhouseCoopers Hospitality & Leisure Practice.

Never before have there been numerous real and perceived deterrents to both leisure and business travel beyond the economy.

"It is likely that the 'travel concern' effect will diminish over time, but it is also likely that the effects will continue," adds Dr. Hanson.

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