While Florida recently set records in domestic tourism visitation, business travel revenue is down across the state, according to a new report by the American Hotel and Lodging Association (AHLA), anticipating an end-of-year profit margin nearly $1 billion below expectations.

The report emphasizes that the travel industry is still not back up to pre-pandemic levels, due in part largely because business travel profits operate differently than that of vacation travel, relying largely on large groups booking swaths of rooms and conference centers months or years in advance, providing an assured stream of revenue. Business and corporate group travel is the leading source of revenue for hotels, but the AHLA anticipates revenue for the state to be at a decrease of 11 percent compared to last year.

“While dwindling COVID-19 case counts and relaxed CDC guidelines are providing a sense of optimism for reigniting travel, this report underscores how tough it will be for many hotels and hotel employees to recover from years of lost revenue,” said Chip Rogers, President and CEO of AHLA. “The good news is that after two years of virtual work arrangements, Americans recognize the unmatched value of face-to-face meetings and say they are ready to start getting back on the road for business travel.”

Florida’s desirability as a destination for large-scale meetings and conferences, with hub cities like Orlando and Miami, offer advantages over other states. As a result, groups like the Florida Restaurant Lodging Association (FLRA) have high hopes that business travel returns to past numbers after a recent push for return-to-office work as COVID-19 restrictions were largely eased nationwide.

“Florida remains a top destination for both leisure and business travel, but today’s projections have Florida ending the year 11 percent down for business travel,” said Carol Dover, President and CEO of FLRA. “We are incredibly proud of Florida’s comeback story, but this report reiterates that there is more work to get us back to pre-pandemic figures. Business and corporate group travel is the leading source of revenue for hotels, which have endured years of catastrophic losses and now face inflation, supply chain issues, and staffing shortages. As businesses become more comfortable with a return to conferences, events, and business travel, we encourage them to come to the Sunshine State.”

The new report comes on the heels of a recent AHLA survey, which found 64 percent of employed Americans and 77 perent of business travelers agree that it is more important than ever to bring back business travel. The survey also found that 80 percent of employed Americans and 86 percent of business travelers say face-to-face interactions are important for maximizing company success.

The shifting sentiments around business travel are supported by a recent analysis conducted by the San Diego State University School of Hospitality & Tourism Management on behalf of AHLA that found in-person business travel and meetings carry advantages over virtual options, and that businesses and organizations that resume business travel and meetings more quickly are likely to have a competitive edge over those that do not.