PRESS RELEASE

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

The Travel Business Roundatble (TBR) Index Of Leading Economic Indicators Advances Strongly In March With A 1.7 Percent Increase

WASHINGTON, D.C. - May 8, 2001 -- The Travel Business Roundtable (TBR) Index of Leading Economic Indicators advanced a robust 1.7 percent in March. Comparatively, the U.S. Index of Leading Economic Indicators declined 0.3 percent - the 11th monthly decline during the past 15 months.

According to Dr. James Howell, economist and president of the Boston-based Howell Group, the strong March increase in the TBR Index was somewhat surprising, particularly in terms of the magnitude of the increase. Howell adds that irregular up and down swings are commonplace when the economy’s growth path is transitioning from a period of strong cyclical growth to one in which activity is peaking.

In addition, these sawtooth swings accurately describe the month-to-month variations in the TBR Index over the past 10 months, with six monthly increases and four monthly declines. This pattern is likely to continue at this stage of the business cycle, so that an April decline is very possible.

"As a result, we can conclude that the current behavior of both the TBR Index and the U.S. Index correctly point to the slowing that is now taking place in the economy as a whole, though they don’t yet show the characteristic behavior that presumes a recession will follow," adds Howell. "The significance of this is that the performance of the two Indexes has weakened, but they have not yet led to a cumulative, mutually reinforcing decline. That is a development that signals the emergence of a recession."

The bottom line is that these data, combined with the two percent increase in real GDP in the first quarter, do not indicate that a recession is in the offing.

The strong March increase in the TBR Index was spread throughout most of the nine indicators that comprise the Index, with advances in seven of the sectors. These included: Hotel/Motel Revenue, Consumer Confidence, ARC Sales, Hotel/Motel Occupancy, ATA Revenue Passenger Miles, Personal Consumption Expenditures for Travel and Related Items, and Retail Sales at Eating and Drinking Establishment.

Data were unchanged from the previous month in Rental Car Revenue Per Day and Travel and Tourism Employment.

With regard to the U.S. Index of Leading Economic Indicators, the 0.3 percent decline reflects a continuation of sideways-to-softening monthly changes that began in January 2000.

The continued weakness in the U.S. Index correctly predicted the slowdown in the economy, as measured by changes in real GDP that took place in the second half of 2000.

Looking ahead, the Conference Board argues that the failure of the U.S. Index to fall into a cumulative decline provides a strong signal that the economy, while at a peak in activity, has not yet, and will not likely, slip into a recession.

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.

Most recently, members of TBR met with White House officials to present Policy Recommendations for the Bush Administration and the 107th Congress.

In addition to a request to create a Presidential Advisory Council on Travel and Tourism, the group addressed other issues affecting the future growth and vitality of the industry, including:

	Travel and Tourism Industry Worker Shortage
	Work Opportunity Tax Credit
	Welfare-to-Work Tax Credit
	Raising the visibility of the U.S. as an International Travel Destination
	Travel and Tourism Satellite Accounts
	Minimum Wage Policy
	Business Meal Deduction
	Expanding Aviation Capacity
	American with Disability Act Accessibility Guidelines

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, 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 within the decade, 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.

Projected to be the world’s largest industry within the decade, travel and tourism is also America’s leading services export, travel and tourism created a trade surplus of nearly $17 billion in 2000, generating $93 billion of tax revenue and more than $550 billion in total expenditures.

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