There is no doubt that business travel is an essential ingredient in the US economy, much like other countries across the world. However, a recent insight from business solutions specialist Expert Market has highlighted that the nation’s cities are among the most expensive for global business travellers, accounting for 5 out of the ‘Top 10’ most expensive cities for business trips in the world and half of the ‘Top 20’ most expensive places for business travel.
- New York, San Francisco and Boston revealed as most expensive global cities for business travellers in 2017.
- Tokyo the most expensive city for business travellers outside of the US, while Zurich tops the cost league in Europe.
- London has the most expensive accommodation costs outside of the USA.
- Buenos Aires has seen the largest rise in business travel costs, up 31% versus 2016.
In a study earlier this year entitled ‘The US Business Travel Economic Impact Report’, the GBTA Foundation, the education and research arm of the Global Business Travel Association, in partnership with American Express Global Business Travel (GBT), highlighted the positive economic impact business travel has on the US economy.
Its research revealed business travel was responsible for about 3% (USD547 billion) of US GDP in 2016 and that for every 1% change in business travel spending, the US economy gains or loses 74,000 jobs, USD5.5 billion in GDP, USD3.3 billion in wages and USD1.3 billion in taxes. The business travel industry supports 7.4 million jobs and generated USD135 billion in federal, state and local taxes, according to the report with domestic business trips alone reaching 514.4 million and costing businesses USD424 billion.
In 2016, the average amount spent for both domestic and international inbound trips in the US per business fell 2.2% to USD520, including USD163 on lodging, USD180 on transportation, USD94 on food and beverages in restaurants, USD33 on entertainment and USD50 on shopping and merchandise. Expert Market’s latest insight shows why these costs are high.
Using data from BTN’s Corporate Travel Index, Expert Market has produced a visualisation of the most expensive cities for business travel, including the daily cost of accommodation, taxis or car rental and food. Its findings show that New York is the most expensive city for business trips costing companies a staggering USD549 per employee per day. Hotel accommodation emerged as the biggest cost, totalling USD385 per night.
San Francisco (USD534) and Boston (USD511) completed the ‘Top 3’, ahead of the first non-US destinations of Tokyo (USD489) and Zurich (USD472) which complete the ‘Top 5’ (Washington DC (USD462) and Chicago (USD444) also made the ‘Top 10’). These were closely followed by London (USD467), which had the highest rate for hotel accommodation (USD279) outside of the US. Basel and Geneva, were the remaining cities in the ‘Top 10’, costing USD443 and USD432 per day respectively, with the former topping the bill for most expensive food at USD133.
The Americas region also headed the list of destinations with the largest rise in costs between 2016 and 2017 with the cost of staying in the Argentine capital Buenos Aires rocketing by almost a third (31%) in the past year. In the US, Chicago headed this ranking with a 16% rise in costs versus 2016.
Global business travel spend approached USD$1.3 trillion in 2016, up 3.5% over 2015 levels, according to the Outlook – Annual Global Report & Forecast from GBTA. Pending many global uncertainties, the organisation predicts business travel spending to accelerate significantly in the coming years, advancing 5.2% this year, 6.1% in 2018, followed by roughly 7.0% growth in both 2019 and 2020. Business travel spending gains have not reached this level since 2011, it says.