One topic dominated conversations between UK-based travel buyers at BTN Group’s Business Travel Show Europe in London the week before last. As businesses are finally emerging from post-Covid hibernation to resume travelling, there aren’t enough travel management company staff to serve their needs.
BTN Europe interviewed three travel managers – Peter, Paul and Mary (not their real names to spare their TMCs’ blushes) – about the problem and all three told a similar story. “Delays in phone calls and e-mails being answered have been an issue since travel ramped up at the start of September,” says Peter.
Paul’s company uses two TMCs and is experiencing difficulties with both. “It is common for our travellers to have wait times of up to 40 minutes to speak to someone,” he says. And even when someone does eventually answer, service is a lower standard than pre-pandemic. “Our dedicated team has disappeared,” Paul adds. “We now get somebody or anybody answering the phone when we call, so they don’t know us, or, if they do, we have changed our policy anyway.”
The problem extends beyond reservations consultants. “My account manager has left the industry after being furloughed,” says Mary. “Our new one was given to me. There was no conversation about it. She is very green. I can mould her into what I want but I would always prefer someone more experienced. However, that’s not going to happen at the moment.”
TMCs are not alone. Staff shortages are affecting other aspects of UK business travel, including a well-documented post-Brexit exodus of EU citizens working in hospitality. Another travel and meetings manager told BTN Europe his company is struggling to stage meetings successfully because of understaffed hotels in the UK.
The same point was made during a Business Travel Show Europe panel session by Jason Long, senior vice president of strategic accounts for hotel portal HRS. “Some hotels are limiting capacity as a result of it,” Long said. “You may find rates will rise faster in the UK because of staffing issues. We’re already seeing evidence of that.”
In the TMC world, a unique set of demand and supply trends have converged to produce what Paul describes as “the perfect storm”. On the demand side, bookings are rising sharply after the UK government finally relaxed some of its most draconian border controls. But it’s not just reservation numbers that are increasing. So too is the amount of TMC work required per reservation because travel has become so much more complicated.
At Business Travel Show Europe, one travel manager speaker revealed the average number of calls his travellers make to their TMC to arrange a trip has shot up from three pre-pandemic to 14 today. That aligns closely with figures supplied by Clive Wratten, chief executive of TMC body the Business Travel Association: his members report an increase from four calls per booking to 14-20.
Clients are also shunning online bookings, which require far less TMC intervention. “Our onlne adoption rate has moved from the high 90s to 60-70 per cent because travel is more complicated,” says Paul. “We’ve not switched air back on on our online booking tool because it can’t distinguish between domestic and international flights.”
Paul’s company wants all international flights to be booked offline for now not only because of Covid complexities but also, he said, “new visa and work permit restrictions” imposed on post-Brexit travel to the EU.
Travellers are also opting for human assistance for reassurance. Paul’s travellers have had bad experiences of booking hotels online only to find the hotel closed when arriving for check-in. “It’s making our people nervous about booking online,” he says.
On the supply side, TMCs have been reducing staff numbers, either permanently or through the UK government’s furlough scheme. Lynne Griffiths, CEO of specialist business travel recruitment company Sirius Talent Solutions, says reductions have ranged from 15 per cent at best to 70 per cent at worst.
A large but unknown number of furloughed staff returned to their TMCs as the scheme wound down only last week. That should help relieve the problem, but a lot didn’t come back. “Many of those on furlough considered their options and moved outside travel because they wanted job security,” says Peter. Griffiths adds that TMC staff are also quitting because “job opportunities are opening up in other sectors”.
As for travellers being served by consultants unfamiliar with their account, Griffiths says a major determinant is the fee model agreed between TMC and client. Management fees guarantee the TMC some income even when the client is not travelling. Transaction fees don’t. “If you are on a management fee, that protects staff to some extent and clients have not lost as many of the team,” says Griffiths. “If you are on a transaction fee and you have not had any transactions, then the TMC cannot afford to retain those staff.”
When will this perfect storm abate? The consensus is that the problem will right itself eventually but in months rather than weeks. In the short term, according to Paul, clients will need to show patience rather than penalising breaches of service level agreements. “We’ve not been enforcing it because we realise the situation they’re in,” he says. “If every organisation started to enforce its SLA, the TMCs would suffer even more. But it will get to the point where we will be fed up if they don’t do something.”
Griffiths says some TMCs anticipated an uptick in demand in September and started bringing back staff from furlough two to three months previously for retraining. For others, last week’s return may take a few weeks to feed through. Meanwhile, Peter’s TMC is dealing with the immediate crisis by patching calls and e-mails to under-utilised consultants in Australia, who work through their night to serve UK customers.
There are also steps corporate clients can take, including shifting back to booking online where appropriate and urging travellers to avoid booking at the last minute. Wratten says travellers can also help if they carry out some basic research about border control requirements before ringing their TMC for confirmation. “Look it up and ask ‘Have I got it right?’ rather than ‘What do I do?’ he says.
Longer term, the key question is whether enough former TMC personnel can be persuaded to return and young people persuaded to enter the sector.
Mary is optimistic about the former. “People always try to leave travel but usually they come back,” she says. “It’s in their blood. Give it six months and they will come back.” She is less convinced about the latter, however, and calls for more apprenticeships, which she says are more commonplace in leisure travel, although Wratten says TMCs were stepping up apprentice schemes before Covid hit.
The other burning question is the effect on cost. “Travel consultants, especially experienced ones, are going to be in demand,” says Griffiths. “There will be a shortage, especially as there was a problem with consultants retiring anyway. With a shortage of talent, salaries will increase. We are already seeing that with middle management positions, and we expect more of that. There could be fee inflation for corporate clients as a result.”
Wratten agrees. “Fees may have to be increased,” he says. “We’re seeing inflation in salaries across the economy. It will be necessary to get the talent in.”