A report from AAA suggests that travel this Labor Day weekend will be the highest in five years as consumers finally exit the gloom of the financial crisis. Consumer confidence is up, and so is consumption. That, according to today’s report, means that more than 34 million Americans will take trips longer than 50 miles this Labor Day weekend.
According to the motor club, this weekend will see 34.1 million Americans take to the roads and airports, beating last year’s 32.7 million. The number still falls far below the record, set five years ago. Back then more than 45 million Americans traveled during the long weekend.
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Consumer spending increasing
Consumer confidence has seen a significant rise in 2013, with the CCI index standing at Just over 80 in July. The index ended 2012 at just under 67. The boom in consumer confidence is associated with a rise in incomes and a rise in consumer spending through 2013. The economy is getting better, and consumers are spending more. Hoteliers and other tourist facing businesses are sure to notice the change during the course of the long weekend.
Spending during trips is likely to increase according to the AAA. The average spend during the weekend is set to hit $804, compared with last year’s average spend of $749. Americans are set to travel slightly shorter distances, however, with the length of the average expected journey coming in at 594 miles, compared with last year’s 626 miles.
Labor Day travel cheaper than last year
According to the report, which is based on a research from IHS Global Insight, 29.4 million Americans will travel by car during the course of the long weekend, while 2.61 million will travel by air. Last year, 29.2 million and 2.54 million traveled by road and air respectively in the course of the labor day weekend.
Another factor in the decision to travel is, as always, the price of gasoline. Gas prices are around 2.7% lower than this time last year, according to the AAA report. Gas prices are expected to remain lower than last year according to forecasts from the report. That’s good new for Americans and good news for businesses.
If Labor Day weekend, which takes place between August 29 and September 2, plays out like AAA project, it will demonstrate an economy that’s bouncing back, and may help to further the increase in consumer confidence. In a consumption heavy economy like the United States, that’s a big win for investors heading into the rest of the year.