Global Courant
Canadians continue to spend more on travel as the industry slowly recovers from pandemic disruptions, according to RBC Economics — but many are opting for closer destinations, with travel to the US on the rise.
Travel spending is up nearly 30 percent from pre-pandemic levels, according to an RBC Proof Point report released in late May.
In January 2022, Canadians spent about 60 percent less on travel than before the pandemic began. But that number quickly skyrocketed and has remained high.
Between January and April 2023, more than 10 million Canadians traveled abroad, a seven percent increase from the same period in 2019.
Last summer, hotels and tours were much more expensive than in 2019, with flights more than 30 percent more expensive and rental cars 50 percent more expensive.
Costs associated with these specific activities have fallen slightly, but Canadians have faced higher food and shelter costs this year amid rising interest rates. However, this does not stop Canadians from investing in travel.
According to RBC, by 2023, more Canadians will decide to fly instead of drive while traveling. In the first part of the year, the number of Canadians returning from air travel rose 42 percent.
However, a higher percentage of these flights now go to the US rather than destinations further afield. About 134 percent more Canadian residents returned to the country from the U.S. by air between January and April 2023, compared to 2019. The report theorized that price played a role, as shorter trips are cheaper.
However, price isn’t the only driver for Canadians looking to travel right now. The report also looked at Google Trends and found that more Canadians were more likely to search for the word “best” when Googling travel-related queries, as opposed to the word “cheap.” Before the pandemic, and in 2020 and 2021, the gap was narrowing between those looking for “best” versus those looking for “cheap”, but the gap has widened over the past year.
Within Canada, travel trends are shifting eastward, with Atlantic Canada experiencing a greater increase in interest than any other region in the country, according to Google Trends. At the same time, the population of the eastern provinces is increasing, possibly reflecting the continued level of remote working.
The report predicts that while there is likely to be a dip in travel spending once Canadians tackle the increasingly expensive world, demand is unlikely to crash dramatically.
