The cost-of-living crisis continues to bear down on people across the UKwith further bad news this week thanks to a higher than expected level of inflation.
With fears that interest rates could hit 5 per cent, and doubt cast on Prime Minister Rishi Sunak‘s promise to halve inflation by 2024, it’s a rather bleak time for many Britons.
And yet, in spite of this gloomy financial outlook, people are still spending money on booking holidays, even as they cut back on meals at restaurants and clothes shopping.
last week The Independent reported that money spent on flights and holidays actually rose in the first three months of 2023 compared to the previous year, according to new research.
The figures appear to show a trend towards more budget friendly options, with spend with low-cost airlines rising faster than the rest of the industry. EasyJet said this week that its revenue per seat has risen by 42 per cent in the six months until the end of March.
While the latest data from banking app Revolut offers a similar picture over holidays – a 91 per cent jump in bookings by their customers when comparing January 2023 to the same period in 2022 – its findings suggest travelers are opting for longer breaks and spending more. However, this could be explained by the fact that, since the removal of the majority of Covid-19 travel restrictions, the cost of living in general is higher.
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Price consideration is the “main priority” for potential tourists in 2023 who look to make “better, informed decisions about their discretionary spend,” Naomi Hahn, vice-president of strategy at Skyscannertold The Independent.
Recent polling of customers by the travel search engine showed that 41 per cent are planning to take the same number of holidays this year as they did in 2022, with one-third thinking of upping their time away; just 7 per cent are planning to holiday less.
Holidaymakers “continue to prioritize adventures abroad and embrace travel freedoms with relish,” said Ms Hahn, adding: “For those who don’t see [rising prices] impacting their plans, the resounding reason cited is that they have decided to prioritize holidays over other big-ticket items.”
London-based Sophia, 29, works in HR consulting. She’s had a busy year of travelling, starting the year in Australia and Bali before a weekend in Paris last month. She has trips to France, Spain and Italy planned before the year is out.
“Pre-pandemic, I was always so exhausted when I went on holiday that I spent half of it relaxing – or recovering. Now I see it much more as an opportunity to see the world, connect with loved ones and remember there’s much more to life than work,” she told The Independent.
Sophia considered holidays in the UK but soon realized they could be just as expensive, if not more, than trips to the Continent. But how does she fund her getaways?
“Material things” have completely “taken a backseat” for her: “Unless it’s something I need, I’d much rather spend the money on experiences,” she said.
“For example, my mum is losing her sight, so being able to travel with her is time sensitive and very special. The only thing I’d really want to save for is a flat to call my own but the ability to save enough for a deposit whilst paying London rent feels so out of reach – for now I’m choosing to enjoy the world instead.”
Some people have taken on extra work outside of their full-time roles to keep their holiday plans on track. That’s the case for 23-year-old Nathan Ruff, who works in communications. He recently bought a house in Cambridgeshire and admits his “finances took a significant hit”. This hasn’t stopped him from travelling, though: “I have started to slow down on general spending and have canceled some of my UK trips, but my holidays abroad are some of the things I look forward to most each year. I plan in January then count down the days until the next one comes around.
“I have worked second jobs on weekends in the past six months so that I can be comfortable and afford those few extra luxuries. I always tell myself that I won’t remember those weeks or weekends when I just sat at home, or when I worked extra hours, but I will make lifelong memories from those overseas experiences a couple of times a year.”
The big holiday this year for Mr Ruff is a two-week break in thailand, for which he’s looking at cheaper places to stay to make his money go further. Cutting back on takeaways has been a surprisingly effective way to ensure there’s money for travelling, he said, with he and his partner managing to save around £200 a month by not ordering in.
Nights out, eating in restaurants and saving to buy a house are the biggest areas being cut back for Amber Braysher. The 25-year-old contracts executive from Surrey said she has considered traveling less but “would rather sacrifice other things”, although financial pressures mean she has “compromised on holiday destinations – seeking better value for money – and the length of stays, and have started seriously considering currency exchange rates”.
The reason why people are putting money into traveling over other activities is because it offers “real time away from the stresses of daily life” and “something to look forward to”, Ms Braysher believes.
Having been to dubai and Lisbon since the start of the year, she’s planning visits to Greece and the Dominican Republic over the next few months.
“I have been saving to buy a house but due to rising costs it looks like I’ll be unable to buy at this time. I might as well travel now while I’m able to without the pressures or constraints of owning a property,” she added.
The Advantage Travel Partnership, the UK’s largest travel agent group, told The Independent that it’s seen an increase in bookings for summer 2023 holidays compared to 2019, as well as strong performance for 2024, with 20 per cent of last week’s bookings for travel next year.
Julia Lo Bue-Said, CEO of Advantage, said: “Overall travel remains hugely important to Brits, it provides a space for relaxation, allows you to spend quality time with family and loved ones, as well as providing unforgettable experiences and lasting memories.
“Recent trends from across our travel agent members suggest a holiday is the last thing that is going to be given up, despite the current economic backdrop.”
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