People take photos by colourful beach huts, in front of the red sky at sunrise in Blyth, Northumberland, England, Tuesday, Feb. 23, 2021. (Owen Humphreys/ PA via AP)
LONDON (AP) — Stir-crazy Britons rushed to book overseas vacations after Prime Minister Boris Johnson unveiled plans to slowly ease a national lockdown, boosting optimism that travel restrictions will be removed in time for the summer holiday season.
TUI, the U.K.’s largest tour operator said bookings increased six-fold on Monday, the company’s busiest day in more than a month. Discount airline easyJet said demand for flights more than tripled, and package holiday company Thomas Cook said traffic on its website increased 75%. International travel has nearly ground to a halt globally, so the increases are a sign of hope for the beleaguered industry.
“We have consistently seen that there is pent-up demand for travel, and this surge in bookings shows that this signal from the government that it plans to reopen travel has been what U.K. consumers have been waiting for,” easyJet Chief Executive Johan Lundgren said in a statement. “The Prime Minister’s address has provided a much-needed boost in confidence for so many of our customers in the U.K.”
While the plans, which Johnson announced Monday, were welcomed by travel companies, many business leaders were disappointed at the slow pace of re-opening as some restrictions are expected to remain in place until June 21. Others criticized the government for failing to guarantee current levels of support for businesses hurt by the COVID-19 pandemic.
The Office for National Statistics said Tuesday that the U.K.’s unemployment rate rose to 5.1% in December, up 0.1% from the previous month and 1.3% from a year earlier. The number of people on company payrolls has dropped by 726,000 since the pandemic began last February, with 58.5% of the decline coming among people under 25.
But the figures don’t show the full impact of COVID-19 restrictions. Some 1.9 million workers remain on furlough, a government program that covers 80% of the wages for people who aren’t working but remain on their employer’s payroll.
“The sheer longevity of the crisis is taking its toll on firms, and young people in particular who have borne the brunt of jobs losses,” said Nye Cominetti, senior economist at the Resolution Foundation, a think tank focused on improving conditions for low-income people. The government “will need to address this in next week’s budget by both extending emergency support to firms while restrictions are still with us, and announcing fresh stimulus to power Britain’s economic recovery.”
Airlines and hospitality businesses have been particularly hard hit by the pandemic, with restrictions all but shutting down international travel and closing pubs and restaurants for much of the past year.
The government is now considering the possibility of introducing some type of “COVID status certification” to give business owners and consumers confidence about the safety of reopening theaters, restaurants and other venues this year.
So-called vaccine passports, which could include information on whether a person has been vaccinated and recent COVID-19 test results, raise difficult questions about privacy in Britain, which doesn’t have a tradition of national identification cards.
“There are deep and complex issues that we need to explore, and ethical issues about what the role is for government in mandating for people to have such a thing,’’ Johnson said Tuesday after visiting a school. “We can’t be discriminatory against people who, for whatever reason, can’t have the vaccine … I think everybody should have a vaccine, but we need to thrash all this out.”
Britain has had Europe’s deadliest coronavirus outbreak, with more than 120,000 deaths attributed to the disease.
Faced with a new variant of the virus that scientists say is both more transmissible and more deadly than the original, the country has spent much of the winter under a tight lockdown, the third since March 2020.
Schools, bars, restaurants, gyms, hair salons and nonessential shops are closed, people are expected to stay at home except for exercise and essential shopping, and foreign holidays are banned.
But Johnson announced plans to ease those restrictions as the rapid rollout of vaccines helps drive down new infections and hospitalizations.
On March 8, children in England go back to school and people will be allowed to meet one friend or relative for a chat or outdoor picnic. Three weeks later, people will be able to meet in small groups outdoors for sports or relaxation.
Under the government plan, shops and hairdressers will reopen April 12. So will pubs and restaurants, though only for outdoor service. Venues such as theaters and cinemas, as well as indoor seating at bars and restaurants, are scheduled to open May 17. That is also the earliest date Britons may be allowed foreign holidays.
The final stage of the plan, in which all legal limits on social contact are removed and nightclubs can reopen, is penciled in for June 21.
The government says these dates may be postponed if infections and hospitalizations surge.
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7 Hotel Stocks Just Waiting For the Vaccine
Like any group of stocks related to travel and tourism, hotel stocks saw a steep drop in share prices in 2020. The leisure and hospitality sector that once had 15 million employees has lost 4 million jobs since February.
Many major cities will be feeling the ripple effects of the Covid-19 pandemic for years. However, there is ample evidence that shows the pandemic may be coming to an end. The number of new cases is dropping. The number of those getting vaccinated is rising. And even in the cities with the most restrictive mitigation measures, the slow process of reopening is beginning.
All of this can’t come fast enough for individuals who rely on the travel and tourism industry for their livelihood. Hotel chains had at least some revenue coming in the door. And when earnings season concludes, the more budget-friendly hotel chains may realize revenue that is 75% of its 2019 numbers. But that is not enough to bring the hotels to anywhere near full employment. Particularly with hotels that have bars and restaurants that have remained closed or open at limited capacity.
Many economists are optimistic that travel may begin to look more normal by the summer of this year. And the global economy may deliver 6.4% GDP growth this year. With that in mind, the hotel chains with the best fundamentals and the broadest footprint will be in the best position as the economy reopens.
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