HIL, the leading indicator of the U.S. hospitality industry, showed a 0.4% increase in March, being the second month of 2010 (after February and the slight decline in January) to show an increase in the hospitality sector, according to reading data from STR and economic research firm e-forecasting.com.In April the HIL also showed growth but lower, being 0.3%. This indicator presents on average the activity of the businesses of the industry four to five months in advance.
The six-month metric growth rate, which is a sign of turning points, rose at an annual rate of 8.7% in April, after rising 10% in March. This compares to an annual long-term growth rate of 3.5%, similar to the per-year growth rate of the nation's overall economic activity. In the deepest part of the recession, in January 2009, the growth rate slowed to 15.7%.
Four of the nine components of the HIL had a positive contribution during the fourth month of 2010: Hotel profitability, future demand from international visitors, new orders for manufactured goods and housing activity. However, the other components: fairness of the labour market, weekly hours in hotels, extended interest rates, oil prices and barometer of national holidays, presented a negative or zero contribution.
According to Evangelos Simos, chief economist at e-forecasting.com, profit making in the industry will be slow, but steady.
