LESI IS JUST A CLICK DOWN
The results of the most recent Lodging Executives Sentiment Index (LESI) indicates continued expansion in general hospitality business conditions. The index registered 81.3, just a click and a slide from last month's 81.6. While the Present Situation Index reads slightly lower at 78.1 against last month's reading of 81.6, the Future Situation Index reading of 84.4 moved up from 81.6.
Lodging executives continue to be quite optimistic about the future. The LESI, created three and a half years ago, is a leading indicator based on opinions of lodging executives. A LESI index reading greater than 50 indicates that the industry is generally expanding and below 50, the lodging sector is generally declining. The distance from 50 shows the strength of the expansion or decline of the industry.
The responses show that no one believes current business conditions are bad; 44 percent say conditions are normal, and 56 percent define current conditions as good. The Present Conditions Index reading of 78.1 indicates business is still in an expanding mode and has been so for the last 12 periods. About seven in ten executives surveyed believe business conditions will be better in the next 12 months, while 31 percent sense that conditions will be about the same.
The survey question asking lodging executives to project rooms reservations over the next 12 months finds lodging executives balancing their responses about future business conditions with optimism. The Reservations Expectations Index stands at 84.4 — down very slightly from the previous reading of 86.8, with 69 percent of executives saying they expect room reservations to increase in the next 12 months to increase.
The Lodging Employment Index reads slightly higher at 62.5, versus last period's reading of 60.5. The employment index asks lodging industry executives whether, over the next 12 months, they expect to: 1) add to the total number of non-management employees, 2) keep the number about the same or 3) reduce the total number of non-management employees. More than a third of respondents expect to add employees over the next 12 months and 62.5 percent expect to keep the total number of non-management employees the same. None plan to lay off employees in the next year.
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