It’s not your imagination. Americans are spending significantly more for their summer vacations than they did in pre-pandemic 2019, as prices are soaring for every component of a trip — gas, airfare, hotels, restaurants and just about everything else.
Rising Gas Prices
With average gas prices across the U.S. topping $5 a gallon, two-thirds (66%) of Americans now say rising gas prices will impact their decision to travel in the next six months, according the latest survey from the Longwoods International tracking study.
But just like a Broadway show, the road trip will go on. Even with these cost concerns, 91% of travelers have trips planned in the next six months. “So far we haven’t seen the demand to travel abate,” says Amir Eylon, CEO of Longwoods, the travel and tourism market research company that fields the ongoing study.
Rather than cancel their vacations, most travelers will look for ways to downgrade their trips. “They’re just reallocating their spend to stay within their travel budget,” says Eylon. “So it’s a few less t-shirts and souvenirs for the kids. Or maybe they’re packing sandwiches in the car for the road, or eating out a little bit less.”
Flying? Sky-high demand for travel, combined with higher fuel prices and a pilot shortage has created a perfect storm for jacked up airfares. Prices have risen a whopping 47% since January, according to data from Adobe Analytics.
“The reality is the airfare is very high this summer, higher than we’ve seen before,” says Hayley Berg, chief economist at Hopper, the deal-finding site and app.
The average domestic roundtrip airfare is $395, down from its peak of $420 at the beginning of June. Peaking in early June is just the typical seasonal pattern for airfares, says Berg.
From January through May of this year, consumers spent a total of $37.1 billion online for domestic flights, nearly double what was spent in the first five months of 2019, according to data from Adobe Analytics.
A sizeable chunk of that difference can be chalked up to airfare inflation. Though bookings were down 2.3% between April and May, spending on flights was up 6.2% during that same month and up 30% compared to May 2019, reflecting the significantly higher prices travelers are paying.
“While some consumers have been able to stomach the higher fares, especially for those who delayed travel plans during the pandemic, the dip in bookings shows that some are rethinking their appetite for getting on a plane,” says Vivek Pandya, lead analyst at Adobe Digital Insights.
According to the most recent Longwoods survey, more than a third of Americans (36%) say high airfares are likely to impact their decision to fly in 2022.
Pricier Hotels and Restaurants
After transportation, accommodations and dining are typically the two biggest vacation categories.
The average daily hotel rate in the United States is now $147.35, up 11.3% from 2019, according to the latest report from STR, a data analytics company for the hospitality industry.
Budget-minded travelers might consider avoiding destinations that have seen much higher rates of hotel inflation. In Miami, for example, the average hotel now costs $209.55 per night, a whopping 37.8% jump over 2019 prices.
Dining out at restaurants costs 7.2% more than a year ago, according to data from the U.S. Bureau of Labor Statistics. Interestingly, the cost of eating out has risen significantly less than the cost of eating in (11.9%), a data point that may make it easier to justify not cooking for yourself while on vacation.