Business travel – an indicator of South Africa’s economic status


Corporate Traveller: Spend on business travel indicates which sectors are bearing the brunt of a troubled economy, and which are growing in spite of it.

So which sectors of the economy are flying, and which aren’t?

Analysis of the flying habits of Corporate Traveller’s clientele how often and where, throughout this year has provided fascinating insights into which parts of our economy are thriving, stagnating or struggling.

And the picture appears to be rosier is some sectors than it is in others, according to Corporate Traveller, which services the business travel needs of numerous South African entities and private companies, arranging flights, accommodation, on-the-ground transit, foreign exchange and other services for hundreds of corporate clients.

Raylene Pienaar, Corporate Traveller General Manager says definite trends emerged this year around business travel, with some industrial and commercial sectors sending their executives on far fewer business trips, while other sectors significantly increased travel spend.

“There has been strong business travel growth this year in the energy sector, and especially in companies and entities whose business is in sustainable and so-called ‘green’ energy. Renewable energy businesses, especially, are showing great growth, booking more flights both locally and abroad than ever before,” says Pienaar.

Financial institutions and management consulting companies, too, are showing good upward trajectory in business travel, especially on the continent, perhaps indicating that these skills domiciled in South Africa are in demand on a continent that’s been identified as a global economic growth region.

However, there has been significant decline in business travel across some sectors of the economy, Pienaar says, indicating perhaps that these industries bear the brunt of bearish economic conditions.

Those sectors include mining houses and industries that support the mining industry: construction, engineering, and environmental consulting. Global construction companies are also under apparent pressure as their business travel has decreased markedly this year, Pienaar says. Travel has been flat in that sector this year when compared to 2014.

However, numerous Corporate Traveller clients in this sector have told her and her colleagues that new projects in the 2016 pipeline means they will be travelling at full strength again next year.

Finally, the property management sector, Pienaar says, has shown no growth at all in its 2015 business travel purchases. In fact, there has been a marked decline in travel as consultants stay at head office and manage properties remotely.

Naturally, digital technology enables people to work off-site and offers an alternative to getting on a flight and paying a personal visit to a client or partner. However, this is not the sole reason that some sectors are cutting back on business travel.

“Some of our clients tell us they need to spend cautiously, and are cutting back until macro and industry-specific conditions improve,” says Pienaar.

“The opposite is true of clients in industries that are thriving and doing well. They want to make the most of face time with associates. They see the value in investing in travel for business: to close the deal, offer a personal handshake and develop those critical personal relationships.”


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