We’re all tired of talking about a recession, so it seems like the conversation is getting more optimistic.
A couple of years ago, when the hotel industry collectively started seriously talking about the possibility of recession, it was not at all uncommon to hear people vocalize concerns that hoteliers could “talk themselves into” a recession.
I don’t know how realistic that point of view really is, especially considering you don’t really see hotels receding while the rest of the economy continues to hum along, but are we now at a point where we’re trying to talk ourselves out of one?
For example, Bernard Baumohl, chief global economist at The Economic Outlook Group, spoke glowingly of the industry’s prospects at The Lodging Conference a couple of weeks ago.
“We’ve achieved something quite special, growing for more than 10 years,” he said. “The fundamentals of the economy are still great—unemployment rates are the lowest we’ve seen, wages are still moving up, people are spending, borrowing costs are among the lowest we’ve seen, there’s ample capital looking for investments. These are not the symptoms of an economy that’s approaching a peak.”
He was considerably less optimistic as recently as July 2018, when he spoke at HSMAI’s 2018 Revenue Optimization Conference, predicting the future would be especially difficult as “the (economic) models we use are incredibly ill-equipped to handle the impulsive decision-making and convulsions taking place right now.”
Baumohl said that was an ominous portent.
“The concern I have is we’re beginning to see the seeds of a much more significant slowdown in 2019 and 2020,” he said at the time.
Now, I don’t intend at all to pick on Baumohl. He is empirically very good at his job.
But what accounts for this shift in overall attitude or at least the shift in how we talk about it? Are we at a point where forecasting a recession is moot because it’s now a matter of when and not if? Or is it more about recession-talk fatigue?
The old adage goes you should plan for the worst while you hope for the best.
If you are an hotelier who at this point who isn’t really coming up with plans for “the worst,” i.e. an overall economic recession, than you’re simply negligent in your duties. So maybe collectively and subconsciously the industry is choosing to vocalize more of the “hoping for the best” part of that equation since the first part is now implicit.
It’s probably telling that I haven’t heard anyone use baseball analogies for the industry basically all year. Even the joke about how the metaphor is overused is too overused to merit mention anymore.
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