A recent poll conducted by Harris Interactive (R) shows that the financial situations of 48% of U.S. adults are worse than one year ago.  What does this mean for the travel industry?  Fewer people are taking vacations at all, and the ones who do are spending far less money.

When it comes to vacations, many people are bargain hunting.  Instead of flying, they are taking cars.  The travel behaviors for 2009 also indicate that fewer people will be traveling for business purposes.

Nearly half of the people surveyed say they intend to travel just as much as before, and 37% of consumers are less likely to travel due to the economic climate.  About one-fourth of respondents intend to cut their trips short, and 40% will have a tighter budget for leisure trips.

How do vacationers intend to cut costs and still enjoy their leisure time?  Three-fifths will choose less expensive accommodations, cheaper meals and less expensive activities.

Almost half claim that they will cut travel costs by vacationing closer to home or staying with friends/family at their vacation destination.  Some will drive instead of flying.

A little over a third of people plan to vacation close to home or share costs by traveling with friends and other families.

Companies are changing their travel plans as well.  Travel policies are being changed, and business trips are being reduced.  Nonessential travel is being reduced or totally cut by some companies in order to reduce travel related expenses.

How long will these trends last?  Harris Interactive will release research findings this fall to provide the travel industry with insight into the next twelve months.

Due to the recent economic climate, the travel industry has suffered greatly.  Now there is even more to add to the mix - swine flu.  Roger Dow, president and CEO of the U.S. Travel Association, states that this has the potential to paralyze travel.  He adds that it could even be catastrophic.

It is feared that this situation will quickly get out of hand, so precautions are being taken.  Americans are being urged not to travel to Mexico, and are also being checked at airports for signs of fever.  This is a huge blow to the travel industry.

Add to this the fact that Androulla Vassiliou, the European Union’s health commissioner suggested that people should not travel in to Mexico or the United States if it isn’t necessary, and the results are devastating.  She did later state that it was only an advisory and not a ban, but the damage may already be done.

On Monday April 27th, airline stocks slid and hotel business wasn’t much better.  Marriott (MAR) fell 5/1% to $21.17.

Although the government hasn’t instructed precautionary measures be taken by the airports, some are implementing safety precautions of their own.  Many are looking at passengers for potential signs of swine flu, while in Singapore, Sofia, Tokyo and Bulgaria more active measures are being taken - the use of devices to take passengers temperature.

Many companies have restricted travel to Mexico for their employees.  Among these are Daimler, Sony, Nokia and Royal Philips Electronics.  Workers in Mexico have been instructed not to shake hands or hug visitors that do come in.

Although it could be a dangerous situation, many are wearing gloves and masks on their faces to avoid possible spread of swine flu.  It seems that word and panic have spread much faster than the swine flu has.  Maybe this “pandemic” isn’t quite the monster it was first thought to be.  As for the travel industry, time will tell.

In a tough economy, taking a luxury vacation might seem impossible. But some of the nation’s nicest hotels are taking steps — including lower rates and vacation specials — to lure new visitors.

Take Gaylord Hotels. The luxury multi-property operation with resorts in Nashville, Dallas, Washington, D.C. and Orlando offers guests majestic views, high-end shopping and dining experiences, full business accommodations and world-class entertainment. Even better, the hotels offer packages for special events.

Starting at just $199, guests can discover the rich history of the Nation’s Capital and enjoy a one-of-a-kind experience at the Washington region’s newest waterfront resort destination. The package includes round-trip tickets on the resort’s exclusive shuttle to downtown Washington, D.C., which makes stops at Union Station and the Old Post Office. Afterwards, guests can take advantage of the resort’s offerings, which include four restaurants, Pose Ultra Lounge, Relache Spa, nightly entertainment and an all-season pool. This package is available now through August 31, 2009, but other great packages can also be found.

In addition to finding great packages, Gaylord offers these tips for travelers hoping to enjoy a little luxury without breaking the bank:

- Plan meals carefully. Choose package deals that provide breakfast at no extra cost. If you have children, choose family-friendly restaurants that allow children to eat for free. If your hotel room has a refrigerator, consider purchasing lunch staples so that you can prepare you own mid-day meal.

- Save your money for nice dinners. Before making a dinner reservation, look for coupons or ask the front desk about area restaurants that give discounts to guests.

- Travel with friends or family members. Some hotels and entertainment destinations, like museums or theme parks, offer discounts to guests traveling as a large group.

- Pack wisely. Don’t bring things that the hotel will provide, like soaps or shampoos. Bring refillable water bottles so that you don’t have to purchase new ones at every destination. If you have a young child, bring a light stroller to save on rentals.

Those in the travel industry have coined the term “new normal” as what is happening in their business.  Hotels, airlines, conference centers and car rental companies have experienced deep plunges to lower levels than seen in years in their revenue, and expect it will continue for years to come.  They believe this will be typical.

Huge bargains can be seen in air fares and hotel costs as travel companies struggle against the plunging economy.  This is ironic, as drastic reductions have also led to a reduced number or business meetings companies are holding, which is why many business people traveled in the first place.

The new term was buzzing around at the annual education conference of the Association of Corporate Travel Executives in Washington.  In the last 20 years, some who attended said they couldn’t remember a time that buyers as well as suppliers were more concerned about that is being done to curtail travel.  Business travelers now realize that it is necessary to get the utmost out of every business trip.

While some cities provide cheaper hotel costs and airfare, they are seldom chosen as sites for business meetings because of other aspects of the cities.  Cities like Las Vegas have lower hotel rates, but offer too many other attractions, so executives are likely to avoid these cities.

The pace of the economy will of course decide whether this really is the “new normal” level of business travel, but the immediate concern is how long it will take to climb out of this deep recession.  The need to reduce global warming and create renewable-energy sources is likely to lead to a whole new era of business travelers.

A recent survey conducted by Ernst & Young LLP shows that hotel owners and management companies are increasing efforts to strengthen cash positions in order to survive the economic downturn.  The purpose of these efforts is to efficiently position their businesses for mid and long-term growth.

Key findings in the survey, conducted in global hotel enterprises that range in size from under $150 million to over $600 million in revenues, resulted in the following:

Cost Management - The hospitality sector is likely to be affected with hiring freezes, reductions in working hours and layoffs being implemented.

Capital Strategies - Of the respondents in the survey, 33% state that they plan to raise new capital in 2009, with 38% stating they will seek capital in 2010-2012.

More than two thirds of respondents plan to enter into joint ventures with other capital enterprises to make their business stronger.

Business Challenges - The second biggest challenge to the hotel business is decreasing average room rate, according to 56% of respondents.  This is right behind the biggest challenge, which is considered decreasing demand by 82%.  Other challenges that respondents considered are lack of financing, steadily climbing labor costs and competition increases.

Green Initiatives - Up to 88% of respondents currently use recycling programs and energy saving measures in their hotels.  Those that do not intend to implement these measures next year.

Recent meetings at the White House, Treasury Department & Fed’s office have been constructive since the Obama administration began.  Before any more bailout’s can be distributed, the government realizes it needs a better understanding of the financial system.

Jeffrey DeBoer who is president & CEO of The Real Estate Roundtable stated at the American Resort Development Association convention that getting commercial real estate lending going again is top priority.  He believes that commercial properties will experience increased foreclosures as we have seen in the residential market.

Two facilities may offer a solution to this problem.  TALF (Term Asset Lending Facility) has been compared to a giant credit card, and offers attractive financing to investors and private equity groups.

The PPIF or Public-Private Investment Fund organized by the government is a program put together by the government that will use private capital along with public money.  The main task is to re-secure or refinance existing loans and new transactions, which will require a large amount of equity.  This will help regain investor confidence.

DeBoer stated that the current policy-making process contains dialogue that is very constructive towards relieving the downturn of the US.  Roger Dow, president & CEO of The US Travel Association, stated that President Obama, who recently met with them about the state of the vacation industry, left them feeling that he knows where the challenges exist.  During the President’s visits overseas, he has a huge opportunity to pitch American to the world.  He will keep the pressure on to help improve tourism in the US.

As revealed in the most recent travelhorizons (TM) survey, travel in America remains popular.  In fact, almost two thirds (63%) of adults in the U.S. are planning to take at least one overnight trip in the next 6 months for leisure enjoyment.  Of course, the higher the household income, the higher the incidence of leisure travel.  Also indicated is that 1 of 6 adults will make an overnight business trip in the next 6 months.

It appears that the number of adults who are traveling is not declining so much, but the travel behavior is changing.  In a questionnaire posed to respondents, here are some of the actions people are taking to reduce travel expense.

1.  87% say they will purchase a travel package to save money

2.  84% expect to spend less money overall

3.  64% will comparison shop online.  It is no surprise that the internet is becoming more and more popular for finding the best deals

4.  64% say they will take more frequent day trips

5.  51% will stay fewer nights to reduce costs

It is apparent that when travelers reduce the number of nights they stay, it will have a huge impact on lodging, cruise and attraction industries.

These statistics make it clear what needs to be done in future marketing and communications of these industries.  The focus should be less on getting people to take trips and more on persuading them to extend their stay.

The economy seems to be affecting everyone.  Walt Disney Company acknowledged that in the last six weeks, 1,900 jobs have been slashed, most of them in Florida.  In Florida alone, 900 layoffs occurred and 500 vacant jobs will go unfilled.

Disneyland in Anaheim, California also suffered, with 200 layoffs and 100 unfilled positions.  The company stated that it has been affected by the recession, and has had to offer huge discounts to keep attendance up.  Disney began downsizing on February 18th.

According to the company, most of the layoffs pertain to management, executive and administrative positions.  Before the layoffs and buyouts, Disney claimed to have about 62,000 local employees.

For weeks, Disney refrained from revealing the total number of layoffs as it spread across the entire operation.  Some departments affected included entertainment, transportation, finance and human resources.

Disney did not notify the state about the layoffs, which is against a federal law known as the Worker Adjustment Retraining Notification Act (WARN).  The company stated that it was not required to give a notice because the cuts involved multiple sites, and that their company is not a single-site operation.

There are exemptions to the single-site rule outlined by the U.S. Department of Labor regarding notice, but there seem to be differences of opinion regarding this matter.  The Labor Department states that the single-site definition is not to be used for the single purpose of evading WARN notices.

So far, it appears that most of the layoffs have affected more salaried than hourly employees.  These employees received severance packages with benefits for a 60 day period.  Union representatives said they will oppose any efforts to cut remaining employees hours.

The glut of hotel rooms in Las Vegas has led to “some screaming deals out there to go to Vegas,” according to Orbitz Worldwide Inc. Chief Executive Officer Barney Harford. “There’s been a lot of construction activity in terms of building out new hotels,” Mr. Hartford continued. “That was happening in the run-up to this tough economic environment, so capacity was moving in one direction and then as demand started to go downwards, you really felt a challenge.”

Las Vegas added about 8,000 hotel rooms in 2008, bringing the total to 140,000. With two major casino/resorts expected to open this year, that number will only increase. Other Las Vegas Strip developers have suspended construction on four projects that would have added an additional 6,900 rooms and condos.

According to Rossi Ralenkotter, chief executive office of the Las Vegas Convention & Visitors Authority, visits to Las Vegas are expected to decline 3 percent to 4 percent this year.  Airline flight capacity in to Las Vegas remains almost 15 percent less than a year ago, Mr. Ralenkotter said. At the same time, Las Vegas developers have been preparing to open more than 13,000 new hotel rooms in 2009.

Gambling revenue at Las Vegas Strip casinos dropped 15 percent in January, and 19 percent in Atlantic city in February as the recession tightened its group on consumer travel and gambling spending.

Mr. Hartford said ““People are really trading up to four-star and five-star properties, because the folks are going to go down for a long weekend or something, and they can afford to do that at the current rates.”

USAToday reported Feb. 25 on ten trends that will affect business travel in 2009.

Among the trends noted are:

• Air Travel on Sale - in many markets, prices are at or below pre-2007 levels
• Capacity cuts - Most carriers have already trimmed 10-20% of their domestic flight capacity
• More ancillary fees - for meals, extra baggage, etc.

The article notes that hotels are also beginning to charge more ancillary fees, even though they are understandably unpopular among the traveling public. Amenities such as newspapers and toiletries have been reduced or removed entirely in some cases, and some hotels are now charging guests extra for services such as Internet access.

Read the full story at USAToday.com .