PRESS RELEASE

For Immediate Release
Contact: Debra Kelman 212-794-DKPR (3577)
dkelman@dkpr.com

Travel Business Roundtable (TBR) Index Of Leading Economic Indicators Slips 0.5 Percent In August

WASHINGTON, D.C. - October 16, 2000 - The Travel Business Roundtable (TBR) Index of Leading Economic Indicators fell 0.5 percent in August (see chart) with relatively sharp declines in four of the nine sectors that comprise the overall index.

These included ARC Sales, Consumer Confidence, Hotel/Motel Occupancy Rates and Hotel/Motel Revenues.

The declines in those four key sectors were accompanied by slight increases in four of the remaining four indicators: Retail Sales at Eating and Drinking Establishments, Personal Consumption Expenditures for Travel and Related Services, Rental Car Revenue Per Day, and Travel/Tourism Employment.

Data for the remaining sector - ATA Revenue Passenger Miles - were unchanged from July.

Taken together, the advances made in four of the sectors accounted for a weighted monthly rate of increase of 0.4 percent, but this was offset by the aggregate decline of 0.8 percent in the four remaining sectors resulting in the overall 0.5 percent decline.

"It bears noting that historically, declines in the TBR Index have been common during the month of August," says Dr. James Howell, economist and President of the Boston-based Howell Group. "While this is most likely the result of a statistical aberration that seasonal factors fail to recognize, we anticipate that the September TBR Index will bounce back to a much stronger growth trend."

Howell also adds that the strong monthly increases in the TBR Index, particularly from January through June, demonstrate that the overall economic activity in the travel and tourism industry has continued to outpace growth in the economy’s more traditional manufacturing and distribution industries.

In August, the Conference Board’s U.S. Index of Leading Economic Indicators also declined fractionally, which is consistent with a pattern of monthly changes ranging from -0.3 percent to +0.1 percent beginning in January.

And, while the August change in the U.S. Leading Indicators was welcomed by most economists as additional evidence that the overall pace of economic activity has continued to slow, Dr. Howell points out that there is no evidence that the current slowing will slip into a recession in 2001 or 2002. In addition, he notes the Fed will likely not raise or lower short-term rates until after the election, and the most probable time for a critical assessment of a policy change will not likely occur until after 2001.

The TBR Index is a composite of nine key travel, tourism, entertainment, and restaurant data measures representing all the major economic sectors of this industry. The composite TBR Index represents a weighted computation of the month-to-month changes in each of the individual time series. Seasonal fluctuations are removed from these data before they are aggregated into the final TBR Index.

Overall, the TBR Index reflects key industry changes throughout the national economy and very much like the Conference Board's U.S. Index of Leading Economic Indicators, has been statistically constructed to lead changes in overall economic indicators such as GDP, personal income, industrial production and other major economic performance variables.

The Travel Business Roundtable is a coalition of more than 60 CEO’s representing all sectors of the travel and tourism industry. In addition to the major airlines, car rental companies, travel management agencies, hotel chains, TBR’s membership roster also includes companies such as The Coca-Cola Company, USA Today, TravelNow.com, the Taubman Company, and the International Council of Shopping Centers, demonstrating the broad scope and diversity the industry represents. Projected to be the world’s largest industry in the year 2000, travel and tourism is the nation’s third largest retail industry and second largest employer with more than 17 million Americans employed directly or indirectly in travel and tourism. As America’s leading services export, travel and tourism created a trade surplus of nearly $12 billion in 1999, generating $82 billion of tax revenue and $541 billion in total expenditures.

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