Puerto Rico Responds to Recession Concerns

After reviewing the April State of the American Traveler report issued by Destination Analysts, Discover Puerto Rico shared its insights surrounding traveler concerns as we enter Q2 of 2023.

According to the report, for the first time in five months, more Americans are taking a cautious approach when it comes to spending money on travel. Compared to the same time last year, the report found U.S. travelers have increased recessionary concerns with only 30% of respondents stating that “now is a good time to spend on travel.” Additionally, travel has become more of a “like to have” vs a “need to have” with 55% of respondents sharing that “travel will be a high priority in their spending over the next three months,” a significant drop compared to 61% in 2022. 

In the midst of these changes, Discover Puerto Rico recognizes Puerto Rico’s room rates are higher than ever thanks to strong demand and limited supply over the last several months. The supplier shared that $328 was the average hotel rate in Q1 of 2023, an 8% increase year-over-year. Discover Puerto Rico also noted that the average hotel rate in March of 2023 was $351, a 5% increase from 2022, and a 38% increase from 2019. Similarly, Discover Puerto Rico shared that the average rate for an entire rental unit averaged $244, an increase of 34% from 2019. 

As a response to traveler uneasiness, Discover Puerto Rico is adjusting its marketing strategy to target consumers more resilient to changing economic conditions. And, according to research from Destination Analysts, that makes Baby Boomers Discover Puerto Rico’s perfect target audience. According to Destination Analysts, travelers ages 59 and up are typically less impacted by price changes and inflation. What’s more, Baby Boomers cancel fewer trips due to economic conditions and they’re anticipated to spend significantly more than other generations on travel over the next year.   

In addition to having more dough in their pockets, Destination Analysts argued that Baby Boomers are also a safe bet due to the fact they traveled less than younger generations over the last several years because of concerns surrounding COVID-19. Interestingly, Discover Puerto Rico’s 2023 visitor profile data has the stats to back this up as it found Baby Boomers made up 29% of the island’s visitation demographic for the first quarter of 2023, up five points from 2022. As for the other generations, Millennials are Puerto Rico’s top demographic at 32% followed by Gen X at 29% and Gen Z at 10%.