Americans might be fretting about the job market and inflation, but it’s not stopping them from splurging on vacations.
Nearly half of consumers in August were planning a trip in the next six months — the highest share all year, according to Conference Board survey data Tuesday. And about one in five of them are going abroad, a record share in the data going back to the 1970s.
Demand for international travel has largely recovered as Americans take advantage of reopening borders, a strong dollar and lower airfares in recent months. That’s prompting airlines to boost service and expand routes, and has helped drive a measure of spending abroad by US travelers to an all-time high earlier this year.
The vacation plans reflect Americans’ incessant demand for experiences in a post-pandemic world. Despite an overall easing in consumer confidence in August as inflation and interest-rate expectations rose, many households are still buoyed by the healthy labor market and excess savings.
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Tech, biotech, non-tech layoffs jolt Bay Area with 900-plus job cuts Travel | Ex-Proud Boy Tarrio gets 22 years for Jan. 6 seditious conspiracy That said, it’s not clear how long the elevated spending can last. Consumers are already turning to credit cards as savings tick down and retailers have warned of trouble ahead. What’s more, international airfare prices are expected to stay elevated, which could also impede further spending.
“Consumers have shifted their spending toward experiences, which are easier to finance with credit cards,” Bloomberg Economics’ Eliza Winger wrote in a note Tuesday. “We expect consumer spending to run out of steam ahead, reflecting deflating confidence about future job availability and incomes.”
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©2023 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.
More Americans plan vacations, even as they sour on the economy
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