Hotel Industry Leading Indicator growth slows:
|September 2nd, 2010
|e-forecasting.com eNews for the Hotel Industry
DURHAM, New Hampshire — The
U.S. Hotel Industry Leading Indicator, or HIL, increased 0.2
percent during July after going down 0.5 percent during June,
according to research firm e-forecasting.com in conjunction with
Smith Travel Research.
HIL is a monthly composite leading
indicator that, on average, leads the U.S. hotel industry’s
business activity four to five months in advance. The latest
monthly change brought the index to a reading of 115.8. The index
was set to equal 100 in 2000.
HIL’s six-month growth rate, a signal of turning points, went up by
an annual rate of 6.2 percent during July after going up 7.2
percent during June. This compares to a long-term annual growth
rate of 3.5 percent, the same as the annual growth rate of the
United State's overall economic activity.
Five of the nine components that make up Hotel
Industry Leading Indicator had a positive contribution in July:
labor market tightness, weekly hours in hotels, hotel
profitability, interest rate spread and new orders for manufactured
goods. Four of the nine components had a negative or zero
contribution to Hotel Industry's Leading Indicator in July:
international visitors’ future demand, oil prices, housing activity
and national vacation barometer.
fundamentals that measure the U.S. hotel industry had a strong
positive contribution in July: labor market tightness, weekly hours
in hotels and hotel profitability," said Maria Simos, CEO of
e-forecasting.com."Even with this monthly increase, we are still
seeing a deterioration in the six-month growth rate, which is now
near its long-term trend. This means that growth in the U.S. hotel
industry is headed back to its long-term average and may stop
seeing some of the strong months we have had this summer."
U.S. Hotel Industry Leading Indicator, or HIL, is a monthly leading
indicator for the hotel industry. Building off the tracking success
of HIP, the real-time indicator for the U.S. hotel industry, HIL
was built as a composite indicator that uses nine different
components that, on average, when put together have led the
industry four to five months in advance of a change in direction in
the industry business cycle. The indicator provides useful
information about the future direction of the U.S. hotel industry.