Tourism and hospitality have moved from crisis mode into a new growth phase, with international travel volumes now at or above pre‑pandemic levels and spending hitting fresh records—but recovery is uneven across regions, segments, and customer types. Operators that adapt to shifting demand, rising costs, and new traveler expectations are best positioned to benefit from this next chapter.
1. Global tourism recovery: where the numbers stand
International travel has effectively completed its post‑pandemic recovery and is now entering a new growth cycle.
Key global milestones:
- 2024: International tourism virtually recovered, reaching 1.4 billion international arrivals, about 99% of pre‑pandemic levels and 11% higher than 2023.
- 2025: Arrivals grew a further 4%, to around 1.5–1.52 billion international travelers, surpassing 2019 volumes and setting new records for demand.
- 2026 outlook: UN Tourism expects international arrivals to grow another 3–4% versus 2025, reflecting a normalisation of growth after the rapid rebound of 2023–2024.
UN Tourism’s World Tourism Barometer notes that most destinations not only regained but exceeded 2019 visitor numbers in 2024, driven by strong pent‑up demand and the continued reopening of Asia and the Pacific. At the same time, their experts caution that growth now depends on a stable macro‑environment, easing inflation, and no major escalation of geopolitical tensions.
The World Travel & Tourism Council (WTTC) reports that global travel and tourism’s economic contribution is forecast to reach a record 11 trillion dollars in 2025, equal to 10.3% of global GDP, with international visitor spending set to hit 2.1 trillion dollars, exceeding the previous high of 1.9 trillion.
2. Hospitality recovery: hotels, real estate, and experiences
Hospitality—especially lodging—is benefiting from the tourism rebound, but performance varies by region, segment, and demand type.
Global hospitality market
A recent hospitality real estate market analysis highlights:
- The hospitality real estate market is projected to grow from about 5.12 trillion dollars in 2026 to 6.27 trillion by 2031, at a CAGR of roughly 4.2%.
- Recovery has been driven by international arrivals surpassing pre‑pandemic levels in 2024 (around 1.4 billion arrivals), with tourism generating about 1.6 trillion dollars in revenue across accommodation types.
- Corporate travel and events are rebounding, boosting urban hotel RevPAR, while resorts benefit from wellness and leisure travel trends.
- Institutional investors are deploying capital into hotels, using AI‑enhanced revenue management systems that can lift room revenue by up to 10%.
US hotel and lodging outlook
In the US, PwC’s Hospitality Directions report and a summary from Hotel Dive note that:
- US lodging is expected to see slow but stable growth through 2026, with ADR up about 1.1% year‑over‑year and occupancy forecast around 62.2% in 2026.
- A more stable macro‑environment, steadying credit conditions, and a robust 2026 events calendar (World Cup, major conventions, and global events) should support moderate RevPAR growth, especially in the second half of 2026.
- Higher‑priced and luxury hotels are expected to outperform, supported by resilient spending from higher‑income households and strong group and meeting demand, while economy properties face more pressure as lower‑income travelers feel inflation.
OC&C’s US Travel in 2026: From Turbulence to Tailwinds? frames the US travel sector as returning to “structurally attractive long‑term growth” after the post‑pandemic surge and a more volatile 2025, with enduring tailwinds from experiences and evolving business models shaped by AI.
3. Demand drivers: leisure, business, and “bleisure” travel
The next phase of tourism and hospitality recovery is being driven by a mix of leisure, business, and hybrid “bleisure” travel.
Leisure and experience‑driven travel
PwC’s US hospitality outlook notes that 44% of US consumers planned to travel for the holidays in its 2025 Holiday Outlook, reflecting a renewed emphasis on experiences over goods. Hospitality insights from EHL emphasise that the hospitality industry is entering “a new era of growth and innovation” after a strong comeback in 2024, with occupancy, ADR, and RevPAR all improving.
EHL’s Hospitality Industry Trends for 2025 points to several demand drivers:
- Rising Gen Alpha and Gen Z travelers, who expect digital convenience and authentic experiences.
- Growth of the wellness market, including spa, fitness, and mental‑wellbeing retreats.
- Increasing popularity of workations and remote‑work travel, blending work and leisure.
- More solo travel across age groups, seeking meaningful, transformative experiences.
Corporate travel and events
Corporate travel, meetings, and events are also rebounding, although more slowly and unevenly than leisure travel. A global hospitality real estate report notes that corporate travel expenditures are rising as postponed conferences resume and travel policies normalise, boosting demand for urban and convention hotels.
OC&C’s US analysis observes that corporate travel was weaker through 2025, with airline and hotel performance affected by softness in air travel, but that the medium‑term outlook is positive, with events and corporate demand expected to strengthen through 2026 and beyond.
Domestic vs international travel
UN Tourism reports that both domestic and international travel contributed to the strong performance in 2025, with more than 1.5 billion people traveling abroad and domestic trips reaching record numbers in many markets. This dual engine—local and international demand—creates resilience for destinations able to serve both markets.
4. Regional recovery patterns and unevenness
While global numbers are strong, recovery remains uneven across regions and segments.
UN Tourism’s Barometer and follow‑on analysis highlight that:
- Many destinations in Middle East, Africa, and the Americas reported double‑digit growth above 2019 levels by late 2024—countries like Saudi Arabia, Morocco, Guatemala, El Salvador, Ethiopia, and the Dominican Republic significantly outperformed pre‑pandemic arrivals.
- Asia and the Pacific continues to “catch up,” with a strong recovery trajectory but some destinations still closing the gap due to later reopenings and lingering travel restrictions or capacity constraints.
- Europe, while mature, remains the world’s largest tourism region and continues to benefit from strong intra‑regional travel and stable demand for cultural and city‑break tourism.
The World Economic Forum’s report Travel and Tourism at a Turning Point argues that travel and tourism face “emerging challenges and unprecedented growth opportunities,” stressing that the sector must navigate sustainability, digitalisation, workforce constraints, and geopolitical risk even as demand grows.
5. Key trends shaping tourism and hospitality recovery
Several cross‑cutting trends are shaping how tourism and hospitality recover and grow.
Wellness and transformative travel
EHL notes that the wellness market and transformative travel are central growth themes, as guests seek experiences that improve physical, mental, and emotional wellbeing. This includes wellness resorts, spa and medical tourism, yoga and mindfulness retreats, and nature‑based experiences.
Workations and blended trips
Remote work and flexible schedules have made workations and blended business‑leisure trips more common, especially among knowledge workers. Hotels and destinations are responding with work‑friendly rooms, co‑working spaces, and extended‑stay packages.
Sustainability and responsible tourism
WEF’s travel report argues that tourism recovery must accelerate transformation toward sustainability, with people and planet at the center. UN Tourism likewise emphasises the sector’s responsibility to support socio‑economic development while minimising environmental impact. This is driving interest in eco‑lodges, low‑impact tours, carbon‑offset programs, and community‑based tourism.
Digitalisation and AI
Across hospitality, AI and digital tools are being used for revenue management, forecasting, guest personalisation, and operational efficiency. Hospitality real estate analysis suggests that AI‑enhanced revenue management systems can lift room revenue by up to 10%, improving RevPAR without adding inventory. WEF’s “Turning Point” report likewise highlights AI and automation as critical levers for productivity and better resource use in travel.
6. Challenges: costs, capacity, and workforce
Despite strong demand, the sector faces real headwinds.
Cost pressures and margins
PR Newswire’s summary of the National Restaurant Association’s 2025 outlook (relevant for hospitality F&B) and global hospitality analyses both highlight persistent cost increases—in labor, food, utilities, and construction—as a major challenge. HospitalityNet’s summary of UN Tourism data notes that while arrivals and receipts have grown, global occupancy in late 2024 was slightly below 2019, suggesting that yield management remains crucial.
Capacity and infrastructure
In some destinations, rapid demand recovery has strained air capacity, airport infrastructure, and local transport, especially during peak seasons. UN Tourism’s tracker shows that by late 2024, global air capacity had nearly recovered pre‑pandemic levels, but bottlenecks and staffing shortages still affect peak travel periods.
Workforce shortages and skills gaps
Global hospitality real estate and US lodging outlooks indicate that hotels and tourism businesses face ongoing staffing challenges, especially in housekeeping, F&B, and front‑line roles. Wage inflation, competition from other sectors, and changing worker expectations around flexibility and work‑life balance compound the issue.
7. Strategic priorities for destinations and operators
To turn recovery into sustainable growth, destinations and tourism/hospitality businesses are focusing on a few key strategies.
1. Diversifying demand
Destinations that relied heavily on a single source market or season are investing in:
- New geographic markets (for example, targeting emerging outbound markets in Asia and Latin America).
- Off‑season and shoulder‑season products (festivals, sports events, cultural calendars).
- Niche segments such as wellness, adventure, and gastronomy tourism.
UN Tourism and WEF both stress that diversification helps build resilience against shocks and seasonality.
2. Upgrading product and experience
Hotels and tourism operators are refreshing their offerings to match evolving expectations:
- Renovations and design updates to appeal to younger travelers.
- Enhanced F&B concepts that highlight local cuisine and storytelling.
- Experience‑led packages, including guided activities, wellness programs, and curated itineraries.
EHL’s hospitality trends report describes this as a shift from “recovery” to innovation, where operators use guest feedback and data to iterate on experiences.
3. Investing in technology and data
Digital tools now sit at the core of competitive hospitality operations:
- Revenue management systems (RMS) to optimise rates and inventory.
- CRM and loyalty platforms to drive repeat stays and direct bookings.
- Mobile check‑in, digital keys, and messaging to enhance convenience.
- AI‑driven forecasting to anticipate demand by market and segment.
The global hospitality real estate analysis highlights that investors increasingly value tech‑enabled assets that use AI and advanced analytics to optimise revenue and costs. WEF’s report argues that data and AI will be critical in making travel more efficient, sustainable, and personalised at scale.
4. Focusing on workforce and skills
Hotels and tourism businesses are rethinking workforce strategies to attract and retain talent:
- Offering clearer career pathways and training opportunities.
- Improving working conditions, scheduling, and benefits.
- Leveraging automation to reduce repetitive tasks and free staff for high‑value guest interactions.
EHL’s hospitality trends emphasise that talent development is central to future competitiveness, given that hospitality remains a people‑intensive industry even as technology advances.
8. Key external resources on tourism and hospitality recovery
If you’re researching tourism and hospitality recovery in more depth, a few authoritative sources stand out:
- UN Tourism (UNWTO)
- World Tourism Barometer – up‑to‑date global arrivals, receipts, and outlook, including 2024–2026 projections.
- Analysis such as International tourism recovers pre‑pandemic levels in 2024 for detailed regional breakdowns.
- World Travel & Tourism Council (WTTC)
- Global Travel & Tourism is Strong Despite Economic Headwinds – forecasts for GDP contribution and international visitor spending hitting 2.1 trillion dollars in 2025.
- Summaries of record economic impact and employment in 2025–2026 across destinations.
- Hospitality and lodging outlooks
- PwC – US Hospitality Directions for US RevPAR, ADR, occupancy, and segment performance.
- Hotel Dive – US lodging industry to see slow, stable growth in 2026 summarising PwC’s findings.
- Yahoo Finance and related reports on hospitality real estate market trends and forecasts.
- Strategic and trend perspectives
- EHL – Hospitality Industry Trends For 2025 covering wellness, workations, Gen Alpha/Gen Z, and transformative travel.
- WEF – Travel and Tourism at a Turning Point: Principles for a more resilient future for a broader view on sustainability, talent, and digitalisation in travel.
- OC&C – US Travel in 2026: From Turbulence to Tailwinds? for US‑focused travel dynamics and business model evolution.
Together, these sources show a tourism and hospitality sector that has not only recovered but is now poised for sustained growth, provided operators and destinations lean into innovation, sustainability, and smarter use of data and talent.