Hotel Online Special Report

1999 Lodging Industry Profile
Prepared by: Marketing & Communications Department American Hotel & Motel Association

All figures are for year-end 1999

October 2000 - (Figures for 2000 will not be available until mid-2001.)
                                   
1999 At-a-Glance Statistical Figures
  • 52,000 properties
  • 3.9 million rooms
  • $99.7 billion in sales
  • 63.2% average occupancy rate
1999 surpassed 1998 as the most profitable year in the lodging industry, grossing $22.0 billion in pretax profits -- 5.8 percent more than in 1998 and nearly double the amount earned in 1996, according to Smith Travel Research. The lodging industry has grown steadily after suffering losses nearly a decade ago. Total industry revenue rose from $62.8 billion in 1990 to $99.7 billion in 1999. Total pretax profits rose from a $5.7 billion loss in 1990 to a $22.0 billion profit in 1999. 

The Lodging Industry —

Had an average room rate of 

  • $81.33 in 1999, 
  • $78.62 in 1998, 
  • $75.31 in 1997, 
  • $70.93 in 1996, 
  • $66.65 in 1995, 
  • $62.86 in 1994, 
  • $60.53 in 1993, 
  • $58.91 in 1992, 
  • $58.08 in 1991, and 
  • $57.96 in 1990. 
Directly supported over 7.8 million jobs. 

In the United States, the tourism industry is currently the third largest retail industry, behind automotive and food stores. Travel and tourism is the nation’s largest services export industry, third largest retail sales industry, and one of America’s largest em-ployers. In fact, it is the second, or third largest employer in 29 states. The tourism industry includes over 15 interrelated businesses, from lodging establishments, air-lines, and restaurants to cruise lines, car rental firms, travel agents, and tour operators. 

In 1999, spending in the United States averaged $1.42 billion a day—that’s $59.4 million an hour, $989,300 a minute, and $16,400 a second. 

Tourism Affects Our Economy by —

  • Generating $520.0 billion in sales (excludes the $21.1 billion that international travelers spend on U.S. air carriers—total amount is over $541 billion). 
  • Paying $158.2 billion in travel-related wages and salaries. 
  • Paying $92.5 billion in federal, state, and local taxes. 
  • Approximately one of every seven Americans is either directly or indirectly employed because of people traveling to and within the United States. 
Promotional Spending 

The money all 50 states allocated to tourism promotion totaled over $644 million for fiscal year 1999-2000, a nearly 13 percent increase over the previous fiscal year. Hawaii budgeted the most money to tourism, about $60.0 million. Illinois was second with a $55.5 million budget, and Florida was third with $54.3 million. Illinois plans to spend the most on domestic advertising, budgeting $11.7 million for 1999-2000, followed by Florida ($11.4 million) and Texas ($11.0 million). The total domestic advertising budget is $159 million. 

1999 Property/Room Breakdown 
 

By Location   Property 
(Based on a total of 52,000 properties)
Rooms 
(Based on a total of 3.9 million rooms)
Urban 9.5% 15.8%
Suburban 35.8% 32.9%
Highway 41.7% 29.6%
Airport 6.7% 9.1%
Resort 6.2% 12.5%

 
By Rate Property 
(Based on a total of 52,000 properties)
Rooms 
(Based on a total of 3.9 million rooms)
Under $30 13.7% 3.4%
$30 - $44.99 27.4% 17.9%
$45 - $59.99 33.8% 27.4$
$60 - $85 16.1% 25.1%
over $85 9.0% 26.2%

 
By Size Property 
(Based on a total of 52,000 properties)
Rooms 
(Based on a total of 3.9 million rooms)
Under 75 rooms 51.2% 22.2%
75 - 149 rooms 33.3% 34.6%
150 - 299 rooms 11.4% 21.7%
300 - 500 rooms 2.8% 10.0%
Over 500 rooms 1.3% 11.5%

The Typical Lodging Customer 

  • 24.5% are on vacation
  • 29.7% are transient business travelers
  • 24.4% are attending a conference/group meeting
  • 21.5% are traveling for other reasons (e.g., personal, family, special event) 
The typical business room night is generated by a male (61%), age 35-54 (52%), employed in a professional or managerial position (50%), earning an average yearly household income of $70,449. Typically, these guests travel alone (79%), make reservations (91%), and pay $83 per room night. 

The typical leisure room night is generated by two adults (51%), ages 35-54 (42%), earning an average yearly household income of $62,621. The typical leisure traveler also travels by auto (76%), makes reservations (83%), and pays $76 per room night. 
 

For a hotel stay, 36 percent of all business travelers spend one night, 24 percent spend two nights, and 40 percent spend three or more nights. Of leisure travelers, 43 percent spend one night, 28 percent spend two nights, and 29 percent spend three or more nights. 

International Travel 

The United States receives a larger share of world international tourism receipts than any other country in the world. The U.S. share of the world tourism receipts rose from 16.1 percent to 17.4 percent in 1991 and 1992. In 1993, the U.S. market share increased again to 17.9 percent. In 1994, it dropped to 16.4 

2001 AH&MA Officers 
  • John Russell, chairman 
  • Kirby D. Payne, CHA, vice chairman 
  • Michael K. Handlery, CHA, secretary/treasury 
  • William P. Fisher, Ph.D., president and CEO 
AH&MA, founded in 1910, is a federation of state lodging associations throughout the United States, with some 11,000 members worldwide, representing more than 1.4 million rooms. AH&MA provides operations, technical, educational, marketing, and communication services plus governmental affairs representation to the lodging industry. 
percent and then to 15.6 percent in 1995. In 1996, the market share increased to 15.9 percent and to 16.7 percent in 1997, and then it dropped back to 16.2 percent in 1998. In 1999, the country’s share of world travel receipts also increased to 16.4 percent representing $74 billion in travel receipts. 

The top 10 countries in terms of U.S. arrivals for 1999 were: 

  1. Canada (14.1 million), 
  2. Mexico (9.9 million), 
  3. Japan (4.8 million), 
  4. United Kingdom (4.3 million), 
  5. Germany (2.0 million), 
  6. France (1.1 million), 
  7. Brazil (665,000),
  8. Italy (626,000), 
  9. Venezuela (552,000), and 
  10. the Netherlands (527,000). 
According to the U.S. Department of Commerce, International Trade Administration, Tourism Industries, there were no significant increases in arrivals from the top 10 markets, but in the top 15 markets, double-digit increases were seen from the Republic of Korea (37%), Taiwan (17%), and Colombia (13%). 

According to Tourism Industries, a record 48.5 million international (International includes Canada, Mexico, and overseas) travelers visited the United States in 1999, a 5 percent increase over the decline in travel in 1998.  Overseas (Overseas excludes Canada and Mexico) arrivals set a new record in 1999 when they increased by 3 percent to 24.5 million. Canadian arrivals increased by 5 percent in 1999 to 14.1 million. Mexican arrivals increased by 7 percent to 9.9 million. 

The impact of international travelers on the hotel industry is considerable. In 1999, 20.0 million overseas travelers stayed in a hotel/motel. Their average length of stay in a hotel was 7.9 nights, with 1.7 people in the travel party. The main purposes of trips for overseas travelers who stayed in hotels and motels were leisure, recreation, and holiday at 41 percent, and business at 32 percent. These extremely mobile travelers visited 1.7 states while within the country. To move about the United States they rented cars (38%) and took domestic flights (31%). 

Preliminary figures for 1999 reveal that international visitor spending in the United States increased by 5 percent, resulting in $95.6 billion total travel receipts. Thus, even though American spending surpassed $81.4 billion (+7%) outside the United States, the trade surplus decreased to $14.2 billion. This is the third straight year that international travel trade surplus declined a downturn that follows a record surplus in 1996. 



Information above is based on data provided by D.K. Shifflet & Associates, Ltd., Smith Travel Research, the Travel Industry Association of America (in association with the Tourism Works for America Council), and the U.S. Department of Commerce’s Office of Tourism Industries/International Trade Administration. 

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Contact:
American Hotel & Motel Association
1201 New York Avenue, N.W., Suite 600
Washington, DC 20005-3931
Tel. (202) 289-3100 Fax (202) 289-3128/3138
www.ahma.com

Also See AHMA’s Lodging Industry Profile Shows 1998 is the Most Profitable Year in U.S. Lodging History / Sept 1999 
AHMA's Lodging Industry Profile Shows 1997 As the Most Profitable Year in U.S. Lodging History / Aug 1998 


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