Introducing the Skift Recovery Index
The Skift Recovery Index is a real-time measure of where the travel industry at large — and the core verticals within it — stands in recovering from the COVID-19 pandemic. It provides the travel industry with a powerful tool for strategic planning, of utmost importance in this uncertain business climate.
Included in the index are:
- Monthly top-level global and country travel recovery indices
- Monthly country-level recovery index for: hotel, short-term rental, air travel, car travel
- Monthly country-level recovery index split by source and destination performance
- Monthly global and country-level macroeconomic recovery index, built upon unemployment, industrial production, retail sales, and stock market returns indicators.
- A mix of leading and trailing indicators. Leading indicators include actual occupancy, revenue per available room (RevPAR), seat capacity, and load factors. Trailing indicators include travel searches and reservations/bookings, cancellations, etc.
The Index focuses on the travel performance in 22 of the largest tourism economies, combined accounting for 62% of inbound tourism receipts, 67% of outbound tourism expenditure, and 78% of global 2019 GDP.
- Hong Kong, China
- South Africa
- United Arab Emirates
- United Kingdom
The selection of these countries is a combination of including the largest economies, and most important tourist destinations and origin markets. The selection purposely includes a number of net exporters of tourism (more inbound tourism than outbound tourism), and net importers of tourism, to track how this impacts recovery.
The Skift Recovery Index Score
Skift Recovery Index (SRI) Score Calculation
The Index is designed to provide an easy overview of the health of the travel industry.
We have tracked the industry since the beginning of 2020. For 2020 counts that the 2020 performance of each indicator is compared to the same time in 2019.
For 2021 counts that the 2021 performance of each indicator is similarly compared to the same time in 2019, since 2020 is not a sound benchmark year to work with a simple year-over-year comparison. This means that the calculation looks as follows:
E.g. Performance in January of 2021 (Jan 1 – 31 2021) is compared to January 2019 (Jan 1 – 31 2019)
The Skift Recovery Index provides a score relative to a baseline reading of 100 for the same month in 2019. The index provides data back to January 2020 for all countries, and will run for an as of yet undetermined time.
Comparing the current performance with 2019 figures, which was a strong year for travel in most countries and verticals, allows for easy interpretation as different verticals and countries are starting to recover at different rates. Possible future downturns can also be identified.
Seasonality provides major fluctuations in the travel industry, and impacts countries differently, and by comparing the current situation with the previous year, the index compensates for any seasonal fluctuations.
Retrospective Data Changes
To make the index near real-time, we have opted for monthly updates of the index scores. Most of our data partners are able to provide us with this data one week after the month is finished.
There are a few indicators which have a longer lag time, including government data for our macroeconomic indicators, hotel RevPAR from STR, and flight load factors and passenger kilometers from IATA.
In these instances we use the most recent month’s data to make an estimate for the current month. We update this retrospectively when data becomes available, which might result in historical revisions to our index scores.
Click below to download the full methodology for the Skift Recovery Index, including further information about the index design, indicators, weightings, and our data partners (subscribers only).