With Americans spooked of flying and the U.S. airlines speeding toward insolvency, the nation's travel and tourism industry is bracing for massive cutbacks in the wake of last week's terrorist attacks.
By one estimate, as many as 625,000 jobs could be lost industrywide, as canceled trips and postponed conventions lead to idled rental cars, empty hotel rooms, vacant cruise ship cabins, wide-open restaurants and quiet casinos.
"It's severe," said Richard Copland, president and chief executive of the American Society of Travel Agents (ASTA), whose membership roster tops 20,000 and offers employment to more than 400,000 people. "These are small businesses. They don't have the wherewithal or cash assets" to survive a lengthy downturn.
At the center of the crisis are the nation's beleaguered airlines, which feed 650 million passengers annually to the rest of the industry. With bookings plummeting, carriers are already slashing flight schedules and jobs to survive. Continental Airlines, for example, has furloughed 12,000 employees and says it will end flight service to 10 U.S. cities.
Some travelers will simply switch to their cars and others will return to the skies once the initial terror of last week has subsided. But analysts say sickness in the airlines is a harbinger of things to come for the rest of the industry, which directly employs nearly 8 million Americans.
"They are the lead dog," said Kevin Mitchell, chairman of Business Travel Coalition, an advocacy group that represents corporations with significant travel budgets. He predicts deteriorating economics at the nation's carriers will result in the loss of 125,000 airline jobs, with an additional 500,000 jobs lost in supporting industries such as lodging, restaurants and casinos.
"When they go down, everything goes down," Mitchell said.
Travel and tourism is considered the third-largest employment sector in the nation, generating $582 billion in annual revenue, according to trade groups.
Last week's unprecedented halting of all U.S. air traffic took an immediate toll on tourist centers such as Las Vegas, which are heavily dependent on air travelers.
While airlines are ramping up their travel schedule, uncertainty has caused a number of business groups to cancel or postpone conventions -- the big-money events that keep everyone from bellhops to bartenders fed in tourist towns such as Las Vegas.
The airline squeeze has temporarily knocked the air out of travel agents and tour operators around the country. And leaders of those industries warn of greater pain down the road if their revenues plunge.
The biggest hit is likely over, since airlines are operating again. But the expected cutbacks in service and layoffs will likely damage businesses for months to come.
"What we're facing is simply unprecedented," confirmed Steve Loucks, spokesman for Minneapolis-based Carlson Wagonlit Travel, the nation's second-largest travel agency. Still, industry leaders warn that it is too soon to measure the long-term impact on travel.
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