New data released by the American Hotel & Lodging Association (AHLA) reveals that the impact of COVID-19 on the travel industry is nine times worse than 9/11. About 70% of hotel employees have been laid off or furloughed, and occupancy rates are hitting record lows, with 8 in 10 hotel rooms remaining empty. AHLA predicts that 2020 will be the worst year on record for hotel occupancy—a warning that has a severe economic impact on the restaurant industry as well.
“The hotel industry is at a critical juncture,” Chip Rogers, president and CEO of AHLA, said in a statement. “We need more resources to survive this unprecedented time. Additional funding is vital for … tens of thousands of small business hoteliers, to help them keep their doors open and rehire and retain millions of employees.”Approximately 61% of U.S. hotels are defined as small businesses.
On Monday, AHLA sent a letter to Congress asking for additional funding under the SBA loan program and updates to the CARES Act to help hoteliers save their businesses and jobs. Specifically, the industry is requesting an amendment that raises the PPP loan limit from 250% of average payroll to 800% of covered costs; this would allow most hoteliers to retain employees and keep their doors open, according to AHLA.
The industry believes that hotel occupancy is not projected to return to precrisis levels before 2021 and revenue will not rebound until 2022.
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