The U.S. hotel & lodging market had a record year in 2023, thanks to robust demand and historically high ADRs according to Phocuswright’s U.S. Hotel & Lodging Market Report 2023-2027. The labor shortage that plagued the industry, causing service declines and high costs, eased somewhat, allowing hotels to resume services such as food & beverage and daily housekeeping.
Overall, the hotel segment captured more than four in 10 U.S. travel dollars spent in 2023, second only to the air segment (see figure below).
Hotels still face many challenges, including rising operating costs as they invest in leadership and talent. They are also embracing new technologies such as artificial intelligence (AI) to streamline services and personalize offerings – big investments that should ease costs going forward. With ADR growth slowing in 2024, hotels are counting on a strong economy to sustain demand. As of 1Q24, the economy remains robust, although some economists predict a slowdown in the second half the year.
Here are 5 key findings from Phocuswright’s report that you should know:
This report is part of the U.S. Travel Market Report 2023-2027 series, which features an overview of the U.S. travel market, along with detailed data and analysis of five key segments: airline, hotel & lodging, car rental, cruise and packaged travel. A standalone report dedicated to online travel agencies rounds out the coverage. Collectively, the series provides comprehensive market sizing, projections and analysis for the U.S. travel industry from 2021-2027.
Other reports in the U.S. Travel Market Report 2023-2027 series include: (available now or publishing soon):
See all of Phocuswright’s free research insights here.
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