The American Hotel & Lodging Association released its 2026 State of the Industry report, examining hotel performance, operating conditions and the sector’s outlook for the year ahead. AHLA projects improved opportunity in 2026 as major global events such as the FIFA World Cup and America250 help lift travel demand and the industry continues to invest in hiring and operations.
This is a marked difference from the past year. In 2025, hotels operated in a constrained environment marked by persistent cost inflation, uneven recovery across markets and shifting travel patterns. While domestic demand remained relatively stable, the report underscores that “stability” is not the same as a full return to pre-pandemic fundamentals, particularly once inflation and expense growth are accounted for.
“AHLA’s State of the Industry Report is clear in its message: hotels continue to deliver economic value in every community and we expect to see improvement over the last, challenging year,” Rosanna Maietta, president & CEO of AHLA, said in a statement. “Even as operating costs remain elevated and profitability lags in many markets, hotels supported more than two million jobs last year and generated tens of billions of dollars in tax revenue for governments at every level. This year we expect consumer spending to rise and our workforce to expand - showing some positives amidst many market challenges as our industry continues to persevere.”
Among the key findings from the 2026 State of the Industry report:
- Hotels generated $85.1 billion in local, state and federal taxes in 2025 (up $1.7 billion from 2024), and that total is projected to rise to nearly $87 billion in 2026.
- Hotel guest spending in 2026 is expected to reach nearly $805 billion, a 1.7 percent increase over 2025.
- Rising operating expenses were a primary factor keeping gross operating profit per available room at roughly 90 percent of 2019 levels.
- The industry paid nearly $128 billion in wages and benefits in 2025 and is projected to approach $131 billion in 2026.
- The hotel workforce is projected to grow by more than 30,000 jobs in 2026, bringing direct hotel operations employment to approximately 2.2 million.
The report also notes that domestic leisure travel remains the largest component of U.S. travel activity, while international inbound travel remains below pre-pandemic levels, an important headwind for destinations that rely heavily on overseas visitation and high-spend travelers.
AHLA’s report emphasizes that converting resilience into sustained growth will depend on a supportive operating and policy environment, including measures that facilitate travel, address cost pressures and strengthen workforce development.