With omicron infection rates falling and mask mandates expiring across the country, many companies are attempting to reestablish a sense of pre-pandemic normalcy by reopening offices and bringing employees back to stay. But while firms return to business as usual, the nation’s biggest companies may never again return to business travel as usual. According to the Global Business Travel Association, spending on corporate travel amounts to a third of what it was before 2020.
For example, the consultancy giant McKinsey was famous for sending its employees on globe-trotting excursions to broker deals and provide corporate guidance. In fact, in 2019 the company spent more than $265 million on U.S.-booked flights alone. After enduring years of the pandemic, however, McKinsey slashed its travel budget by 25 percent. The company intends to focus on its team-building and collaboration efforts at home, emphasizing that returning to the office will make this goal much easier to accomplish.
Concern for the climate may also be having an effect on executives’ travel plans. Many corporations have signed pledges to reduce their carbon footprints, with corporate travel accounting for a large portion of their carbon dioxide emissions. As a result, companies may keep their private jets curbed far more frequently than in the past, although experts admit that some business trips can never be fully eliminated. Outside of these essential excursions, however, the overall outlook on business travel is so bleak that air carriers have started to notice. “Airlines are planning for a future in which there are fewer business travelers,” said Jay Sorensen, CEO of the consultancy company IdeaWorks.
- Why are corporations spending less on business travel than before the pandemic?
- Do you think companies like McKinsey could have trouble attracting top-level talent with reduced business travel budgets? Why or why not?
Source: Stephen Gandel, “Business Travel May Never Fully Recover, as Companies Like McKinsey Make Permanent Cuts to Trips,” The New York Times, March 29, 2022.