Travelers are cutting back on expensive holiday travel plans and opting for cheaper options this year due to inflation, according to a new study.
Rising prices and inflation have caused 77 percent of holiday travelers to modify their plans, according to Bankrate, and 27 percent of travelers are likely to take a car instead of a plane to their destination, specifically due to inflation. Nearly half of U.S. adults are planning an overnight leisure trip.
“People are making changes because of inflation,” said Ted Rossman, senior bank analyst at Bankrate. “In fact, more than three-quarters are changing something, like maybe they’re driving instead of flying or picking cheaper accommodations or cheaper activities. It’s actually a continuation of a trend we’ve seen over the summer, too.”
Experiential spending is “really hot right now,” Rossman said. He includes travel, dining, concerts and sporting events in those spending categories. But people are buying fewer electronics and doing fewer home improvements.
Inflation in Dallas-Fort Worth increased in September, as the regional price measure of common household expenses was 4.6 percent higher than a year ago. Higher gasoline prices were partially responsible then and now, along with still climbing rents, according to new data released by the Southwest regional office of the Bureau of Labor Statistics.
U.S. inflation increased for the second consecutive month, up 3.7 percent in September from a year ago. The national rate rose 0.4 percent from August.
However, it’s still expected to be another busy holiday season for travel coming out of the pandemic. Young adults and people with lower incomes are “feeling more stressed” about holiday costs, Rossman said. That is largely because there is less income to go around and younger people have other expenses like student loans and childcare. Young adults are typically the most likely to travel home for the holidays, he said.
According to Hopper’s 2023 holiday travel outlook, airfares were cheaper this year for travelers who planned ahead early.
Hopper reported flights departing from Dallas for Thanksgiving had an average airfare of $222 per ticket, down 17 percent from a year ago. For Christmas domestic airfare out of Dallas, the average is about $337.
For Christmas and Thanksgiving, popular domestic trips include stops at large cities like New York, Orlando and Los Angeles. Internationally, many are booking flights to Asia for the holidays, because of the shutdowns the country faced during the pandemic. Hopper reported there is demand for regional destinations including Mexico, Central America and the Caribbean.
“It’s going to be a really strong holiday travel season,” Rossman said.
