Advantage2011: Agents are going to have it tough, warns Andrew Neil
Political commentator Andrew Neil has warned travel agents they are in for a tough couple of years as consumers are about to suffer the severest squeeze on living standards since the 1920s.
Neil warned agents they would have to fight harder for every £1 of revenue as rising prices and rising inflation leave consumers with less money to spend.
"People will still book holidays, but they will want the best value for money because they will have less money," he told agents attending the Advantage conference, to which he was invited for the third year running to offer his own perspective on the changing economic and political environment.
Agents who specialise in the over 50s market are likely to have an easier ride as it is the younger clientele and the family market that will suffer the most.
According to Neil, 220,000 new jobs were awarded to workers over the age of 50 last December, yet only 8,000 new jobs went to people under the age of 25. "The unemployment rate amongst under 25s is 20% and rising," said Neil.
Families are being squeezed, especially as more working parents have moved into the higher tax bracket. "It’s not just high earning people like me who now pay 40% tax," but even the head of English in a state secondary school," he added.
Instability in the Middle East and North Africa could rumble on for several decades, said Neil, dampening demand for holidays to the region. "I don’t see an end to the Arab crisis soon and it could take 10, 20, 30 years to sort out."
However, the eurozone could become a more affordable option for cash-strapped holidaymakers if, as Neil suggested, the euro suffers as a result of the ongoing economic crisis, which he predicted could see Greece, Ireland, Portugal and possibly Spain defaulting on their debts.
By Linsey McNeill
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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