Business Travel Expenditure Cleared for Take-off: MBA News

By QS Contributor Updated Sep 01, 2014

Save

Introduction
US companies and the global market
GBTA: China poised to become world's largest business travel market

Business Travel Expenditure Cleared for Take-off: MBA News main image

Download the Global 200 Business Schools Report

Positive signs of growth in corporate profits and jobs among US companies have emerged from a new report into business travel expenditure.

The Global Business Travel Association (GBTA) Foundation's 2014 report is projecting that US companies will increase their spending on business travel by 7.1% this year. This would take total spending to almost US$300 billion over the whole of 2014.

GBTA executive director and COO, Michael McCormick, drew attention to the implicit recovery of US companies in his interpretation of the data. "Business travel growth is a leading indicator of job growth, and we’ve seen this play out in previous quarters as the private sector has finally regained all of the jobs lost during the recession. Today’s forecast suggests that this measured but steady improvement should continue," he said in a press release.

US companies and the global market

Not only is an increasing expenditure on business travel a positive reflection of renewed health among US companies, in terms of profits and job growth, but the ability to travel and directly engage with the global market can then boost a company's economic activity still further.

"It makes sense because companies are looking for business opportunities anywhere they can in a global economy," McCormick expanded in USA Today.

The new figures released come in spite of many US companies succumbing to the effects of wintery conditions in what was a record-breaking season for snowfall. McCormick pointed out that, in most cases, US companies simply reschedule their business travel plans for when the weather improves and hence, there is little impact on the overall picture.

GBTA: China poised to become world's largest business travel market

In a separate report, GBTA announced that China looks set to overtake the US as the world's largest business travel market by 2015.

The difference in expenditure between the two nations dropped to US$66 billion in 2012, and last year this gap fell to US$47 billion, after business travel originating in China rose by 15% to reach US$225 billion in total.

With a further rise of 16.5% expected this year, China's travel spending would surpass the US$300 billion threshold. However, the slight caveat to this data is that an overwhelming majority of these business trips are currently domestic, perhaps more than 90%, and China's population is far higher than that of the US. Even so, the figures stand as testament to the continued prominence of business in the Far East.