July 20, 2024

Corporate Travel Agency Labor Shortage Threatens Recovery

Corporate Travel Agency Labor Shortage Threatens Recovery

Skift Take

Business trips are roaring back, but for how long depends on the breaking points of travel managers and agency advisors making them possible in the first place.

Finding ways to offer more sustainable business trips might once have been among the top challenges for company travel managers, but that’s being replaced by something else: people.

There are now growing concerns that travel departments, and the agencies they use, won’t be able to cope as things pick up again; the labor crunch clearly isn’t exclusive to airlines and hotels.

Reduced internal travel teams, and their agency resources, are now the number one gripe for buyers as business travel returns, according to a recent poll carried out by the UK’s Institute of Travel Management.

Following staffing problems, new data expectations such as CO2 reporting and trip return on investment came second, with reduced budgets third. Tellingly, supplier resources and support came in fourth, followed by legislation changes like Brexit.

“The workload, responsibilities and challenges (travel buyers) are facing continue to run at record levels,” said Scott Davies, CEO of the association, which has 4,800 members who represent 76 percent of the UK’s business travel spend. Pre-Covid that equated to $13.2 billion in air travel and $9.4 billion in hotel accommodation.

“These challenges are compounded as buyer roles have pivoted to assume additional responsibilities over the last two years,” he added.

A Crisis in the Making

Across the pond, travel complexities are accentuated by visa queries and passport renewals.

“If we have an international trip, it’s insane the time that our agency’s spending with that individual,” said Cindy Heston, director of travel and events at Anthem Inc during a recent online event.

“I even have a support person on our team who helps guide them through visas, and she’s working 80 hours a week. We have less than a handful of trips booked, but they’re painstakingly obtuse in the amount of time and effort that’s being curated on each one of these,” she added.

The travel agency told Heston that the call per transaction ratio was off the charts.

“The talent shortage has hit,” said Lynne Griffiths, founder and CEO of Sirius Talent Solutions. “Many people that were made redundant have secured roles outside of travel and are reluctant to return.”

One industry insider, who wished to remain anonymous, told Skift: “It’s a well-known fact in the industry that a lot of corporate travel agencies are now struggling to recruit staff because they let so many go during the pandemic, and now that business travel is returning, there is a shortage of experienced people.”

Meanwhile, as UK agency consortium Advantage Global Network reports a welcome return of corporate travel demand, it has also noted staffing issues persist.

“The two most pressing issues are the drive for sustainability and recruitment,” said its boss, John Hobbs Hurrell. “People moved away from the sector and found other roles. We need to do more to attract people to the industry. We’ll need to pay more.”

Tom Walley, global managing director of Corporate Traveller, also said he believed his agency, which is part of Flight Centre Travel Group, had cut too many people during the pandemic: “We are a couple of hundred people short.”

And a shortage of crews has apparently forced British Airways to consider opening a temporary staff base in Madrid to cope with the summer peak as well as leasing Finnair and Iberia aircraft, according to reports.

There is of course nervous about traveling again, but many companies are now discovering they simply cut too deep at the start of the pandemic.