You see plenty in the press about how much vacation time Americans leave on the table, but the sheer size of this market still makes the USA a formidable force on the travel spending stage. Results from the most recent Vacation Confidence Index from Allianz Travel Insurance found that Americans will top the $100 billion mark in travel spending this year for the first time ever.
How much is 100 billion dollars? To put that in perspective, it’s more than the annual profits of Apple, Walmart, Toyota, Exxon Mobil, Citigroup, HSBC, Verizon, and Samsung combined!
Travel is big business and getting bigger, especially in the USA. Much of this is driven by the local economy, of course. The U.S. one has been on a roll the past four years, getting to nearly full employment in most states and the stock market hitting record levels every quarter or two. Housing prices are back up and in a lot of markets are at the level where hardly anyone is underwater on their mortgage anymore. All of this means the middle class is more confident about spending on travel and the wealthy have more to spend than ever.
The Allianz survey found that, “On average, Americans will spend $1978 on summer vacations, a 10 percent increase from 2016 ($1798), which was an 11 percent rise from 2015 ($1621).” How does that break down among age groups? Vacationing Millennials (ages 18-34) will spend the least this summer, followed by Baby Boomers (ages 55+). Generation Xers (ages 35-54) will spend the most ($2628), on average.
“Americans are feeling better about the economy and have loosened their purse strings for summer 2017,” said Daniel Durazo, director of communications at Allianz Global Assistance USA. “We’re happy to see that for first time in the eight year history of the Vacation Confidence Index, vacation spending will hit an impressive $100 billion. This new milestone is great news for the travel industry.”
The survey, which tracks Americans’ confidence that they will be able to take a summer vacation, revealed that more than four in ten (44 percent, up one point since last year) are confident they’ll take a summer vacation (34 percent very/10 percent somewhat), and half (51 percent, up a point) are confident about the prospect of a vacation at some point in 2017.
There’s a stubborn downside to all this though. Not only do just about a third of Americans own a passport, but many of them are happy to stay put in their comfort zone. Four in ten aren’t confident about taking a vacation and some question the whole idea’s overall importance. “Down a significant six points since last year, the survey found that 59 percent of Americans say that taking an annual vacation is important to them (32 percent very/27 percent somewhat), but “23 percent say that annual vacations are not at all important to them.”
Allianz Travel Insurance’s Vacation Confidence Index also found no significant change in the Vacation Deficit, or percentage of Americans who think that a vacation is important but are not confident they’ll be able to take one. In 2017, 21 percent of Americans who say an annual vacation is important to them are not confident that they’ll take a vacation, down one point from 2016 but still higher than the 2015 Vacation Deficit of 19 percent.
If you’re one of those people who thinks flight costs are too high, you may want to do some digging around. With fuel prices staying low and more routes opening up to Latin America, heading south will likely cost you less than in years past. For the lowdown on each country, head to our Latin America Destinations page and pick your ideal spot. Then don’t forget to pay a tad more for travel insurance. Lost bags, flight delays, and medical problems are much less of an issue if you’re properly insured.
This post is sponsored by Allianz Global Assistance (AGA Service Company) and we have received financial compensation. As usual, all opinions are our own.