Empty hotel beds – the pandemic has hit the hotel industry very hard. It is worst in Stockholm, where both occupancy and prices have completely collapsed compared to 2019, according to recent figures from the Stockholm Chamber of Commerce.
Stefan Westerberg, chief economist at the Stockholm Chamber of Commerce, is concerned about the situation in the hotel industry. Now, after a year of no guests, the crisis is increasing, and hotels are bleeding, he explains.
”"We hear that many hotels have been cutting back on savings for a whole year now. But it won't be long," he says.
The Stockholm Chamber of Commerce has compiled statistics for the hotel industry in Stockholm and the rest of the country during the pandemic year 2020 and the first three months of this year, and compared to the pandemic-free year 2019. It turns out that the decline is brutal. Especially in Stockholm.
”"Accommodation revenue for the month of March this year has decreased by 78 percent in Stockholm compared to March 2019. In the rest of the country, the decrease is 66 percent," he says.
The occupancy rate in Stockholm was only 20 percent, meaning eight out of ten rooms were empty during March this year. In March 2019, the occupancy rate was 64 percent. For the rest of the country, the occupancy rate was 25 percent this March, compared to 61 percent in March 2019.
Prices per hotel night have also fallen, and Stockholm stands out here too. A night in the capital is now, on average, cheaper than in the rest of the country. The average price in Stockholm was 773 kronor in March this year, compared to 1,114 kronor in March 2019. For the rest of the country, the price was 827 kronor in March this year, compared to 1,015 in March 2019.
It's perhaps not surprising that visitors have now avoided Stockholm to a greater extent than other places, he thinks. It's a denser environment in the city, and that's what we want to avoid now, he explains.
”When you have to maintain a greater social distance, the fall becomes greater for Stockholm.”
Furthermore, Stockholm has a large share of the country's tourism from abroad, and when the foreign tourists don't come, the fallout becomes significant.
But he also believes that the big city, as a phenomenon, has become less attractive during the pandemic. Everything that belongs to a big city, with culture, restaurants, crowds and congestion, is now limited. Big cities have simply become more boring during the pandemic.
”"The pulse is paused. We'll see how it develops going forward. We still believe that people want to meet other people."”
Maybe there is hope for the summer for hotels, last year it got a little better during the summer, and it may be the same this year too. At least that's what the Stockholm Chamber of Commerce wants to believe. Even though the vaccine goal won't be reached until the end of the summer.
But the industry needs support, and probably for quite some time to come, believes Stefan Westerberg.
”"We believe that the government must take steps to extend the support during the third quarter as well."”
But it is also necessary to look ahead, to the time when the pandemic is over, according to the Stockholm Chamber of Commerce.
”"We need to look at how to improve the situation for the hospitality industry in the longer term. We have now seen how important it is for entry-level jobs. We need to investigate what can be done to improve the industry," says Stefan Westerberg.
Source: TT
