The Lodging Executives Sentiment Index (LESI) has essentially the same index reading (79.2) for the current period as it did last month (79.3) Last year at this time, the mark stood at 89.1. The LESI shows continued economic expansion in the lodging sector.

This period's Present Situation Index reading of 89.6 compares to 89.1 last month and 87.0 during the same period a year ago. The Future Expectations Index fell a little to 68.8 from 69.6 last period and 91.3 last year. An index reading greater than 50 indicates that the lodging industry is generally expanding and below 50, the sector is generally declining. The distance from 50 shows the strength of the expansion or decline.

While the results of the current survey appear strong, there is a slight moderating effect when we compare them to last year's indices. Both the composite LESI and Future Expectations are about 10 index points lower than they were last year. As the LESI is a leading economic indicator for the lodging sector, are executives telling us that the best of times may be coming to an end?

About 80 percent of respondents say current business conditions are good — down from 82.7 percent with the same sentiment last period. Twenty-one percent believe current conditions are normal versus 27.3 percent indicating normal economic conditions last period.

With regard to future business conditions, the last four periods have seen similar index readings, but they are 15 to 22 index points lower than last year's survey. Four in ten lodging executives forecast that business conditions will be better in the next 12 months, while 54.2 percent feel that conditions will be the same.

Lodging executives expect a fairly large increase in rooms reservations. The Reservations Expectations Index reading of 81.3 compares to last period's index of 71.7 and 93.5 a year ago. Sixty-three percent of respondents expect rooms reservations to increase in the next 12 months, while 37.5 percent feel bookings will stay the same.

The Lodging Employment Index jumped to 78.6 versus last period's reading of 69.6 and 73.9 a year ago. Nearly 60 percent of executives expect to add non-management employees over the next 12 months, while 33.4 percent say they expect employee levels will be the same.

The LESI Indices follow the Institute of Supply Management's Index (ISM) method of tracking leading indicators. The LESI is a leading economic indicator in the lodging sector and is based on opinions of lodging executives. It satisfies the need for real-time information for executive decisionmaking in the lodging industry. Created more than five years ago, the LESI was developed and is maintained by the University of New Hampshire's Hospitality Management Department.

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