The news: Travel companies are cutting jobs to keep costs under control and adapt to softening US demand, part of a broader wave of layoffs across industries.

• American Airlines plans to cut “hundreds” of mid-management and support roles to match its workforce with current needs, Bloomberg reported this week.
• Marriott is laying off a portion of its customer engagement team, per Hotel Dive, after trimming 800 corporate jobs in a restructuring last year.
• And Hyatt idled 30% of its US guest services and support teams in June to cut costs, per Hotel Dive.

US employers set more than 153,000 job cuts in October, per Challenger, Gray & Christmas, which cited slower corporate and consumer spending and AI adoption for the moves. That was the highest for the month since 2003. Retail and consumer products were among the industries hardest hit with job reductions in October.

How we got here: Hotels and airlines have come under renewed pressure as demand moderates, costs remain elevated, and operational disruptions—including those tied to the current government shutdown—test their performance. Travel companies also face a bifurcated environment, with luxury and premium business segments outperforming mid-level and economy brands.

The longest US government shutdown on record has added to the industry’s headwinds.

• The shutdown has caused flight delays and cancellations due to staffing shortages, particularly among unpaid air traffic controllers. This week, FAA leaders said they would cut flights by 10% at 40 major airports to ease pressure on air controllers, which could result in additional revenue losses for travel companies.
• It’s also yet another drag on consumer sentiment as the holiday travel season kicks into high gear. The Thanksgiving through New Year’s period is one of the most important stretches financially for airlines and hotels.

The US Travel Association sent a letter to US congressional leaders this week urging immediate action to reopen the government, saying the shutdown has cost the industry more than $4 billion and now threatens to suppress demand and spending over the Thanksgiving holiday. It added that the FAA decision to reduce capacity would lead to “fewer flights, longer delays and more disruptions” for travelers.

What travel companies can do: The industry will be challenged to maintain service quality and traveler confidence through the holidays while keeping costs in check. The longer the shutdown lasts, the greater the risk of disruptions to holiday operations and travel. To stay resilient, companies can direct promotions toward international and more affluent consumers less affected by economic uncertainty, while cross-training airline and hotel staffers to beef up customer support.

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