Arnie Weissmann
Unemployment has dipped below 5%, and gasoline prices are at a 13-year low. The Census Bureau reported that new home sales increased in all four regions of the U.S. in December, jumping 31.6% in the Midwest and 21% in the West. That same month, the Fed felt so confident in the strength of the economic recovery that it raised interest rates for the first time since the recession.
When I spoke to CEOs in six travel verticals -- hotels, cruise, tour, destination marketing, technology and retail travel -- in mid-December, every one of them expected the tailwinds of 2015 growth in their U.S. business to provide momentum through 2016.
But by mid-January, positive December economic news seemed lost in a wash of anxiety about terrorism, Zika, falling oil prices, the Chinese economy and the U.S. stock market.
As I watched the mood shift, I remarked to the CEO of a large public travel company that it was amazing how much could change in the 30 days between mid-December and mid-January. "It's amazing how much could change between Dec. 29 and Jan. 3," he replied.
I think that narrowing, and the timing, of the window of change is significant. The coming of China's economic slowdown, the reverberations of which are shaking other markets, was no secret throughout most of 2015; Paris' terror had already occurred in November, without crushing expectations for 2016. There was already a keen awareness of ISIS' menace.
The main difference was that in December, we had a good year to look back upon, economically speaking. But between Dec. 29 and Jan. 3, we turned a calendar page to a new year; everything was reset, and all we had left were the signs of uncertainty.
And perhaps the underlying foundation of today's uncertainty for Americans is political. As the primaries drew near, we saw the rise in fortunes of candidates whose prospects for becoming president truly frighten people in the other party (and sometimes their own). Each side sees the potential for four years of doom and gloom, and the messaging is inescapable.
Last Tuesday, I had three industry-related meetings/events that did provide me a bit of clarity, for better or worse.
Breakfast was with John Long, vice president of sales and marketing for Iberostar in North America. As most of the properties he represents are in the Caribbean and Mexico, I first asked him how Zika was affecting bookings. The overall impact on individuals and FIT business, he said, has been "very mild" so far, "but I'm getting emails I'm not liking."
The worry at this point, he said, is group business, stemming from meeting planners' concern for female employees of child-bearing age.
In reaction to Zika concerns, Iberostar instituted a policy that allows rebooking to a date up to two years out, without penalty, if rebooked within a month. It's similar to policies that had been used following hurricane-related disruptions.
But he identified another area of uncertainty that can impact American travel patterns, perhaps positively, but which wouldn't be detected by businesses facing only U.S. consumers: the weakening of the Canadian dollar.
"In Jamaica, [our business is] almost a 50/50 split, Americans and Canadians," Long said. "The U.S. business is good, but not good enough to cover the [drop in Canadian business]. For the first time, we're seeing inventory available even in peak periods.
And so there are deals. "April is going to have great deals," he predicted.
As a result of all of the above, he said, Iberostar strategies and tactics are under constant review.
I got another perspective at lunch when I met with Zine Belhonchet, CEO of the North American operation of RailEurope and CFO of its global business.
He acknowledged, "There are [economic] headwinds," but added, "There are also tailwinds," citing "affordable" airfares to Europe, the strong U.S. dollar and low oil prices.
He also noted that uncertainties in Europe are different from those in the U.S.: European economies did not recover as well as the U.S. economy, and immigration issues there are far more front-of-mind than Zika.
Most relevant to the U.S. industry, perhaps, was his conviction as a French expatriate that American resilience finds a way, quickly, out of problems: "Here, the attitude is always, 'the show must go on,'" he said.
Between breakfast and lunch was an uplifting hour, one of inspiration. I saw a preview of "National Parks Adventure," a 3-D IMAX film funded in part by Brand USA and Expedia, to celebrate the U.S. National Park Service Centennial.
The images are stunning (the 3-D is gilding the lily, in my opinion) and the film will provide inspiration to travel, even in uncertain times. "Nature may heal," naturalist John Muir is quoted as saying in the movie. "In God's wildness lies the hope of the world."
Perhaps this time, instead of a presidential year suppressing travel, 2016 will be seen as a great year to travel as much as humanly possible to escape the 24-hour news cycle. As we hang in the balance between cautious optimism and hopeful pessimism, places of majestic beauty might be the perfect cure for the uncertainty blues.