U.S. Economy/Introduction to Hospitality Market
Most economic forecasters believe that the past several quarters of economic growth were partly a result of fiscal stimulus. Based on that, the forecast for 2011 is for slower growth as the supports and stimuli are now dissipating. The recovery now depends more heavily on the private sector, which faces weakness in income based on high unemployment, reluctance of businesses to rehire aggressively and large overhangs of vacant homes and unused industrial capacity. Moreover, availability of credit is expected to be slow. Goldman Sachs is forecasting a reacceleration in growth to 3 percent in the fourth quarter of 2011 as the headwinds gradually dissipate.

This jobless recovery is creating an environment where expectations from several economists are for 10 percent unemployment again in 2011. Inflation is expected to remain well under control going forward based on the latest survey of Federal Reserve Board likely actions. The following chart shows the Goldman Sachs Forecast for key indicators of the U.S. economy though we have already mentioned that many believe unemployment will actually climb next year:
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Join the industry’s leading experts as they explain:
Strategies and Solutions for the Hospitality Market
Get the best hospitality and legal advice from the experts in dealing with troubled assets.
Click to see Conference Brochure

When: November 3&4, 2010
Where: Hilton Garden Inn, San Diego/ Del Mar, 3939 Ocean Bluff Ave., San Diego, CA 92130
Schedule of events:
November 3, 7-8:30PM ~ Reception
November 4, 7:30-8AM ~ Light Breakfast ~ 8-10AM ~ Briefing

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What to Expect in 2011: What does the hospitality forecast look like for the coming year? How will the booking pace perform? What are the trends in ADR and occupancy growth? What can you expect in transient vs. group business growth?
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Bob Rauch answers questions from Craig Sullivan of The Hotel Inventory on the hospitality market in San Diego during the 2010 Lodging Conference.

Click here to see Bob’s article in The Hotel Inventory

The recovery is real, as we reported in our last update in Hospitality Innsights. Double-dip recession fears are just that – “fears.” It has become clear to forecasters that the bearish predictions for 2010 were a bit over the top. On a macro basis, gross domestic product grew 3 percent in the first quarter of 2010, down from the nearly six percent growth in Q4 of 2009. This growth seems to be more sustainable, and unemployment levels seem to inching back, albeit at a slower pace than all of us would like to see.

Tourism spending rose at an annual rate of 3.9 percent during the first quarter, led by increased spending on hotels and other accommodations, according to The Bureau of Economic Analysis. The increase is significant when compared with a 1.5 percent drop during the fourth quarter of 2009.  Spending on hotels and other accommodations rose at an annual rate of 11 percent in the first quarter, after falling at a rate of 7.9 percent in the fourth quarter. The BEA said accommodations were the largest contributor to the growth in travel and tourism spending.
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