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Fewer Americans to Travel Labor Day

Labor Day w-FlagOn Wednesday, the American Automobile Association (AAA) forecasted that the number of Americans due to travel 50 miles or more during this Labor Day holiday will fall 2.4% from 32.3 million to 31.5 million. This will be the second decline in the last three years, with more people predicted to drive than anything else. The organisation says some of the economic momentum witnessed earlier this year has started to slow. They expect the result of that will be a decline in holiday travellers.

Labor Day weekend will run from September 1 to September 5 this year. The AAA estimates that the number of people on the roads will rise from 27.2 million to 27.3 million, as many are opting to stay closer to home this year. This is a 3% increase in car travel to 87% compared to last year. The average distance Americans are estimated to travel will fall from 635 miles to 608 miles, while spending is expected to increase from $697 per trip to $702.

The rise in driver numbers may be a result of petrol prices falling about 10% since May, when costs rose due to unrest in the Middle East. The AAA says that almost three out of four drivers (70%) say fuel prices won’t impact their Labor Day plans. However, these prices are still high compared to last year, when petrol was 86 cents cheaper per gallon. The average price right now is $3.57. Car hire rates are also on travellers’ side, as the average is expected to be down 7% to $43 per day compared to last year.

As for air travel, the organisation estimates there will be a decline in passengers from 2.58 million to 2.54 million. Additionally, fares for the weekend are due to be 13% more than last year – with an average round-trip rate being $202 for the top 40 domestic air routes. However, accommodations are also due to account for a big chunk of travellers’ spending. The average cost for higher-end hotels will rise from $139 per night to $148, while lower-end venues will cost about $110.

AAA director of travel services Glen MacDonell says that they are projecting a decrease in the number of travellers for Labor Day, as some Americans are reacting to recent uncertainty about the economy and higher ticket prices. The rise in the number of motorists could be more if petrol prices continue to decline in the next week. There could be an increase in last-minute travel plans, he added.

This comes after the cost of living in the US rose by the most in four months in July. During the same month, the unemployment rate rose to 9.1%, while it has been over 8% since February 2009. The forecast for 2011 global growth was cut by Morgan Stanley just last week as it warned that Europe and the US are both dangerously near another recession.




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