The Guild of Travel Management Companies (GTMC), the UK’s leading professional industry body representing travel management companies, has published its second Quarterly Review of 2013, showing that business travel does drive economic growth with exports to non-EU markets up as a result of increased business travel.
The Quarterly Review, which examined the period April to June 13, analyses indicators of activity from the GTMC, including business travel transactions and revenue, and tracks them against a range of economic indicators relating to UK plc, such as changes in GDP, corporate profitability, the level of UK exports and the business confidence monitor.
The transaction survey data is collected from the 38 GTMC members and relate to transactions made for a range of travel services ranging including air, hotel and rail bookings; It is generally acknowledged that travel transactions through GTMC members account for at least 80% of the business travel undertaken in the UK, which forms a valid measure of activity in the sector.
GTMC chief executive Paul Wait said: “GTMC members believe that business travel is not a cost to business but a necessary investment to drive economic growth and prosperity in the UK. Our latest Quarterly Review clearly shows the relationship between business travel and UK economic indicators.”
Key findings from the Review for the second quarter of 2013 are:
- The change in business air activity continues to reflect changes in GDP after a six-month lag.
- The business travel handled by GTMC members and confidence move in tandem; both the business confidence monitor and the FTSE 100 mirror changes in the number of transactions handled by GTMC members.
- UK purchasing mangers are showing increased optimism in 2013; at the same time, business air transactions show a 4% increase in the second quarter from the volume in Q2 2012.
- Business air transactions and corporate profitability move in the same direction and in the second quarter of 2013 both are on definite upward trajectories.
- There is a clear correlation between investment into the UK and business travel.
In addition for the first time the role of entrepreneurs is examined in the latest Review.
Paul Wait said: “It is often said that it is entrepreneurs who restart a stalled economy – there is this compelling idea that people who have been laid off use their redundancy payment to set up a fledgling business, unhindered by the legacy problems that have dragged down their former employers.”
The Review looked at the number of company incorporations at Companies House as a measure of entrepreneurialism and charted this against the total number of business trips as measured by the annual ONS Travel Trends Survey. The results showed that there could be a correlation and given that the other results show the link between business travel and the economy it shows the value of the entrepreneurial engine.
Paul Wait said: “It is my firm belief that business travel and the health of the UK economy are closely linked and two new charts in the latest Quarterly Review, looking at entrepreneurialism and the stock markets and their links to business travel, underline that point. Britain is about to get back to business. It is getting back to business travel too – and not before time.”