Memorial Day launches summer travel spike amid record gas prices

Millions more Americans are traveling for Memorial Day this year despite record-high gas prices, signaling a summer vacation spike that will test the economy’s pandemic recovery amid rising inflation.

Besides rising gasoline prices, summer travelers will pay more for reduced goods and services at airlines and hotels that are still recovering from the low demand of the past two years of COVID-19 lockdowns.

According to AAA, 39.2 million Americans were expected to travel 50 miles or more from home over the weekend, including 34.9 million by car. That number is up from 36.2 million who traveled last year, including 33.4 million drivers and close to the 42.9 million who traveled in 2019.

The spike comes as the price of regular unleaded gas hit $4.599 a gallon on Friday, a fraction of a cent below Thursday’s record-high of $4.60. At the same time last year, it was just $3.041 a gallon.

“Based on the trends we saw in the early spring and now for Memorial Day, we believe travel volumes will continue to increase and more closely mirror pre-pandemic levels,” Ellen Edmonds, AAA spokesperson, told The Washington Times on Friday.

“This is due to pent-up demand from people who chose not to travel for the last two years,” she added.

With inflation raising the costs of everything from hotel soap to airline pretzels, summer travelers will have to budget more carefully.

Airlines and hotels have raised their prices over the past two years to cope with increased operating expenses and reduced demand. They have also struggled to replace furloughed staff, ranging from pilots to housekeepers.

AAA reported that the average lowest airfare for Memorial Day weekend this year was $184 a ticket, 6% more than last year, with Saturday being the priciest day to fly and Monday the cheapest.

Mid-range hotel rates for the weekend were averaging between $199 and $257 a night for AAA-approved hotels, the company added.

Yannis Moati, CEO of the New York City-based Hotels by Day booking service, said rates have gone up because one-fifth of the U.S. hotel industry has been shuttered since 2019 and 15% of rooms are unavailable because of an “acute labor shortage.”

“And everybody decided to travel all at the same time. The current situation is unprecedented, and rates are detached from reality and probably unsustainable,” Mr. Moati said in an email.

On average, he said hotel rates are up 115% from last year and are about 13% more expensive than at the same point in 2019.

In the airline industry, airfares have risen amid an ongoing pilot shortage that has led carriers to cut flights as summer demand ramps up.

On Friday, Delta Airlines announced it was cutting flights to “relieve pressure” in the face of employee absences and other issues. According to FlightAware.com, the airline canceled 17 flights at Seattle International Airport on Thursday afternoon as travelers headed out for the long weekend.

Delta plans to cut 100 flights a day across the U.S. and Latin America from July 1 to early August.

Meanwhile, JetBlue said it’s cutting up to 10% of flights and Alaska Airlines has reduced its schedule by about 2% through June because of an ongoing labor dispute.

Restaurants were also short-staffed heading into the long weekend.

According to the most recent data from the Labor Department, employment in the leisure and hospitality sectors remains down 8.5% from February 2020 before the first pandemic lockdowns.

“Many of the workers that have stuck around through the pandemic are getting burnt out and demanding better wages and more time off, which is driving up the industry’s labor costs,” said Sean Higgins, a labor policy expert at the libertarian Competitive Enterprise Institute.

Economists say that plus gas prices will hit working-class vacationers the hardest this summer — especially Americans who drive to go on camping trips or stay with family for free.

The most recent data from the U.S. Energy Information Administration shows it cost drivers 46% more to fill up their tanks this April than in April 2019. Average hourly wages increased by only 15% during that same period, according to data from the Federal Reserve Bank of St. Louis.

In California, where gas prices are the highest in the U.S., drivers now pay more than $70 to fill an 11-gallon tank with regular unleaded fuel.

Economist John A. Dove, who teaches at Troy University in Alabama, said that’s the only way the industry will absorb the growing travel numbers this summer.

“Most travel-related prices are rising, which is exactly what is needed for the economy to handle this or any spike,” Mr. Dove said Friday.