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MEETINGS, EVENTS AND INCENTIVE TRAVEL: CRITICAL TO AMERICAN JOBS, COMMUNITIES AND BUSINESSES
By admin | February 24, 2009
MEETINGS, EVENTS AND INCENTIVE TRAVEL: CRITICAL TO AMERICAN JOBS, COMMUNITIES AND BUSINESSES
Threats of federal regulation and sensational coverage are creating a paralyzing environment where companies across the country are canceling meetings and events for legitimate business purposes.
After three strong years, Chicago’s downtown hotels are facing tougher times as businesses cut travel budgets and tourists stay home. Because more businesses and groups are canceling meetings at hotels or spending less on food and drink, hotel owners are looking for ways to cut costs.
Business-related travel – including meetings, events and incentives – is a vital part of our national economy and essential to sustaining well-paying American jobs, the health of large and small businesses and the solvency of public services supported by federal, state and local tax-revenue. Broadly, business travel creates 2.4 million jobs, injects more than $240 billion into the national economy annually and generates $39 billion in federal, state and local tax revenue.
Specifically, meetings and events:
Create 1 million jobs to the American workforce in local communities – from big cities to small towns – across the United States.
Many of these jobs support working families in the hospitality and food service industries.
Generate $27 billion in wages for hardworking Americans that are critical to local economies across
the United States, and can play a critical role in our nation’s economic recovery.
Provide $16 billion in tax revenue at the federal, state and local level.
Contribute $101 billion in spending to the U.S. economy.
Support over 200 local convention centers around the county
Are responsible for nearly 15 percent of all travel in the United States.
When businesses cancel productive meetings and events, the American worker and local communities from coast-to-coast are the unintended victims.
Without the jobs generated by meetings, events and incentive travel, the current unemployment rate of 7.6 percent would rise to 8.2 percent and cost the average American household an additional $136 in annual taxes.
Critics have mislabeled many meetings and events as unnecessary and frivolous – causing companies that have received federal government support and many that have not – to cancel planned and future activities.
Whether a company has received emergency government lending or not, its inclination is to avoid the prospect of being ridiculed like AIG, Wells Fargo and others.
No region of the country is immune to the economic impact of canceled meetings, events and incentive programs. American workers and local communities pay the price as meetings, events and incentives decline.
The U.S. Labor Department reported a loss of nearly 200,000 travel related jobs in 2008 and Department of Commerce data predicts a loss of an additional 247,000 travel-generated jobs in 2009.
The meetings and events component of business travel is responsible for nearly 15 percent of all travel in the United States, drives $101 billion in spending, generates one million jobs and creates $16 billion in tax revenue at the federal, state and local levels.
Without the one million jobs generated by meeting and event travel, the unemployment rate in the United States would jump from 7.6 percent to 8.2 percent.
As meetings and events decline, local communities – nearly all of whom are dependent on visitor taxes – struggle to pay for essential services such as education, public safety and social services.
Business travel and events are a smart and cost effective way to retain and develop employee talent, generate ideas and share knowledge that drives future business growth.
Meetings, events and incentives are essential tools for companies to strengthen business relationships; align and educate employees and customers; and reward business performance. Members of Congress share this practice when convening their annual retreats at resorts outside Washington, DC
Incentive programs are two to three times more effective than cash at motivating employee performance. Companies can spend less on incentive travel than on cash compensation to achieve exceptional productivity from employees.
The recipients of incentive travel programs are typically hardworking middle class Americans who have earned trips for their exceptional performance.
According to a recent survey of Fortune 1000 Chief Marketing Officers, meetings and events provide the highest return on investment of any marketing channel.
Companies using taxpayer dollars must abide by best practices for meetings, events and incentives.
Companies that have received emergency government lending have an obligation to operate in a transparent and accountable fashion.
The travel community has addressed an urgent public need by developing clear, workable guidelines designed to ensure responsible business travel practices within companies that have received emergency government lending.
Additional punitive policies to limit meetings, events and incentive travel will unite business, labor and local government leaders in opposition.
The demand for face to face meetings is strong and the importance of having them is greater than ever in our history. For example, within one week of sending the invitation for our Here’s Chicago Meetings and Hospitality St. Pat’s BASH event taking place on March 2, 2009 we are at capacity with the most meeting and event professionals registered in the history of this event with over 400 registered attendees and another 100 on the waiting list.
“Business, Meetings and Incentive Programs are what built this economy” and “Our industry is being punished for the mistakes of a few”
“In Obama’s defense, I don’t believe he knows that the meetings industry contributes to “mainstreet”, the exact market he is trying to help. Bus boys, waiters, bellman, sedan drivers, etc.” says Jim Grillo, CMP of Hereschicago.com.
Meetings, conventions, exhibitions, and incentive travel generated $122.3 billion in direct spending in the United States last year, according to the Convention Industry Council’s Economic Impact Study, released in September. Corporate meetings and events comprised one-third of that, or $40.3 billion; association events accounted for the rest.”
The industry employs 1.7 million people on a full-time basis, and is the 29th-largest contributor to the country’s gross national product.
Looking at types of meetings, conventions and exhibitions account for $67.9 billion, or 55.5 percent, of the total direct spending pie. Corporate and association meetings generated $48.1 billion in spending, or 39.4 percent of the total, while incentive travel made up the remaining 5.1 percent, generating $6.2 billion in spending. (Conventions and exhibitions are defined as events where exhibitions make up the largest component of the meeting, while meetings have a larger meetings component.)
The largest share of the convention and exhibition dollar, 35 percent, is spent in hotels. The rest is widely distributed throughout local economies, with 24 percent spent on air transportation, 14 percent in restaurants, and 12 percent on business services.
It is our responsibility today to communicate the positive messages from our industry and how we all directly contribute to the future growth of our economy.
Let’s make history together,
Jim Grillo, CMP
President
Hereschicago.com
Chicago’s Meetings and Events Resource Directory
Emmy Award Winner, Alternate Media/News 2008
Hall of Fame Supplier, Illinois Meetings & Events 2008
President, Meeting Professionals Internatio, nal Chicago 2003-2004
President, Hospitality, Sales & Marketing Assn of Ill. 2001-2004
Committee, Meeting Professionals International 2004-2008
Mentor/Ambassador, Chicago Convention & Tourism Bureau, 2000-2002
Member, MPI International Student Advisory Council 2008-2009
For a P.R. Toolkit, visit the U.S. Travel Association (USTOA)
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