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US hotel industry recovery continues to slow:
EDITOR'S NOTE
| January 5th, 2011 |
| e-forecasting.com eNews for the Hotel Industry |
DURHAM, New Hampshire —
The Hotel Industry Pulse Index went up 0.4% during November after
an increase of 0.2% during October, according to economic research
firm e-forecasting.com in conjunction with STR.
The Hotel
Industry's Pulse Index, or HIP, is a composite indicator that
gauges business activity in the United States hotel industry in
real-time, similar to a GDP measure for the industry. The latest
monthly change brought the index to a reading of 89.9. The index
was set to equal 100 in 2000.
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HIP's six-month growth rate, which
historically has signaled turning points in U.S. hotel
business activity, continued to deteriorate for the month.
After recording an 11.9% rate of growth during October, the
six-month growth rate fell to 10.8% during November. It is
useful to benchmark against the long-term growth rate of
3.2% as it is the same as the 38-year average annual growth
rate of the industry's gross domestic product.
“With the November Hotel Industry Pulse Index report, we see
that the U.S. hotel industry's recovery pace has slowed but
continues. Although expected, we remain cautious as we
continue to see slowdowns in growth rates," said Evangelos
Simos, chief economist of e-forecasting.com.
The
probability of business expansion in the hotel industry was
at 98.5% during November, slightly higher than October's
reading of 98%.
The
Hotel Industry Pulse Index, or HIP for short, was created to
fill the void of a real-time monthly indicator that captures
current conditions for the U.S. hotel industry. The
indicator provides useful information about the timing and
degree of the industry’s linking with the U.S. business
cycle for the last 40 years. Simply put, it tracks monthly
overall business conditions in the industry, like an
industry GDP, and points in a timely way to the changes in
direction from growth to recession or vice versa. The
composite indicator is made with the following components:
revenues from consumers staying at hotels and motels
adjusted for inflation, room occupancy rate and hotel
employment, along with other key economic factors which
influence hotel business activity.
Story Highlights
- HIP went up 0.4% in November.
- The index sits at a reading of 89.9. It was set to equal 100 in 2000.
- The six-month growth rate slowed to 10.8% from 11.9% in October.
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