It’s crazy to think that we’re nearly half way through what has been, without question, the most chaotic year in recent memory. A year that has had more than its fair share of pandemics, protests, partisanship — the pandemonium that is 2020 has been unequivocally memorable, and for many, forgettable.
The truth is: most people would have probably hit the “reset” button on 2020 by now. We’re exhausted, and people seem to be showing major social distancing fatigue while waiting for things to go back to how they once were.
So how close are we to turning the corner to normalcy in the United States? CNBC recently published an interesting article with some notable trends that give you an idea of where we are, and where we’re headed.
Tracking our recovery
Below are five different trends that have been plotted to show consumer activity since the outbreak occurred in the United States.
Apple Maps navigation data
Interestingly, Apple maps navigation data shows that driving trends have returned to where they were at the beginning of 2020. Walking directions are still lagging behind, while transit data is down significantly.
OpenTable restaurant bookings
OpenTable is still seeing an 80% reduction in restaurant bookings compared to last year — not particularly surprising given that restaurants in many areas are just starting to reopen for dine-in with capacity restrictions. If May’s trend is any indication of what’s to come, it could still be several months before restaurants start seeing traffic even remotely comparable to 2019.
Hotel occupancy rates
Also not surprising is that occupancy rates are still down significantly. The below graph shows the percentage change in occupancy from comparable months in 2019. Since the beginning of April, occupancy has slowly climbed from 22% to 36%. With average rates down 33% and revenue down 62%, the hospitality industry is on a slow path to recovery.
U.S. Air travel
Despite the unbelievable rally on Wall Street to kick off June, U.S. airlines are still hemorrhaging money. Overall, TSA data shows very little change in passenger traffic since late March; things are improving, albeit very slowly. U.S. airlines only carried 3 million passengers in April, a whopping 96% decline compared to last year. In fact, April’s passenger data is by far the lowest recorded month ever — or at least since 1974 when the Bureau of Transportation Statistics started tracking. I do still think it’s reasonable to expect air travel to pick up quicker in the coming months, barring a second wave of infections.
U.S. Home mortgage applications
Perhaps the most interesting statistic of all is the fact that mortgage application volume has not only recovered, but exceeded that of 2019. Contrary to initial speculation, the housing market has gone largely unscathed throughout the crisis, with mortgage rates at historic lows and a continued high demand for homes. Whether that continues to be the case in the coming months and years is yet to be determined. Lowering interest rates appears to have kept a consistent demand for home loans, but it may take months or years to see whether the real estate market will be tested the way it has been in previous recessions.
It certainly seems like the worst is behind us, although the road to recovery still looks discouragingly long. It’ll be very interesting to see how the coming months shape up – particularly for airlines and hotels. It’s hard to imagine these industries suffering a larger dent moving ahead, but we’re truly living in unprecedented times.
Restrictions continuing to ease up as more businesses open their doors to the public will support a quicker rebound in the coming months. However, it seems like there will be continued setbacks along the way as the number of COVID-19 cases continues to rise.
Obviously this data doesn’t paint the whole picture, but it does shed light on what’s changed in the last couple of months, and the lasting impact COVID-19 has had on the economy. It looks like people are getting out (at least in their cars), but we’re seeing very slow recoveries in a lot of major sectors. With unemployment rates still at historic highs, it would appear that we’re only just starting to bounce back.
It’s hard to imagine things getting “back to normal” this year, but I’m hopeful that most industries will make a decent recovery in the coming months. Personally, I think it would be a success to see travel trends recover to even half of what they were in 2019, by December.
With COVID-19 cases continuing to rise as the economy reopens, I imagine some degree of social distancing should become the new norm moving forward. However, as things stand today, we’re still questioning our travel plans through the end of the year.
What do you make of these trends? Are you feeling comfortable about your travel plans for later in the year?