Pricing Power Lags 2019 While Labor Costs Increase
A presentation on inflation’s effects on hotel profitability at the 2023 Hotel Data Conference highlighted hotel rates on a real basis are still down compared to 2019 while hotels continue to face increasing costs, particularly from labor.
Along with cutting into the buying power consumers have, inflation means potentially tighter profit margins for hotels as their operating expenses grow.
During the “Inflation Abomination” presentation at the 2023 Hotel Data Conference, Claudia Alvarado Cruz, senior analytics manager of financial performance at STR, and Aran Ryan, director of lodging analytics at Tourism Economics, spoke about how hotels have been managing rising costs against their revenue streams.
