Due to High Food and Beverage Prices... Even with Reduced Schedules and Expenses, the 'Travel Engel Index' Increases

Consumer Insight, Domestic Travel Expense Trend Survey
Average Cost 230,000 KRW, 78,000 KRW per Day
Increased During COVID-19, Peaked in September Last Year Then Declined
Food and Beverage Costs Rise, Accommodation Costs Decrease

As dining out and food and beverage prices have risen sharply, the proportion of expenses spent on groceries and non-alcoholic beverages during trips, known as the 'travel Engel index,' has increased. With the rise in outdoor activities due to the endemic (periodic outbreak of infectious diseases), 'budget travel,' which reduces accommodation costs and shortens the duration of trips to ease the burden of food expenses, has become a trend in the era of high inflation.

According to a planned survey on domestic travel expenditure trends conducted by Consumer Insight, a consumer research specialist, targeting 2,000 travelers monthly, as of May this year, the proportion of food and beverage expenses among respondents' travel costs was 34%, ranking first. This is a 2 percentage point increase from 32% in September last year. The second highest was accommodation costs at 26%, which decreased by 2 percentage points during the same period.

The increase in the proportion of food and beverage expenses in total travel costs is closely related to the ongoing rise in prices. According to the National Statistical Portal of Statistics Korea, as of last month, the overall consumer price index was 111.12, up 2.9% compared to the same period a year ago. However, the consumer price index for 'food and accommodation,' which is related to vacations and travel, was 117.38, marking a 6.3% increase year-on-year?more than double the increase rate of the overall consumer price index. The dining-out price index also rose significantly by 6.3% to 117.66 compared to the same period last year. Prices for dining out and food and accommodation continue to outpace the overall consumer price index increase.

Travelers are coping with the burden of food and beverage expenses by lowering accommodation costs and shortening travel schedules. According to the survey, the average total cost per person for domestic travel in May was 230,000 KRW, down 49,000 KRW from the peak of 279,000 KRW in September last year, averaging about 78,000 KRW per day. The average travel duration also shortened from 3.16 days to 2.96 days during the same period.

In the COVID-19 Travel Index (TCI) developed by Consumer Insight, the total domestic travel cost TCI in May was 108, an 8% increase compared to the same period in 2019 before the COVID-19 outbreak. It has been declining continuously for three months from 117 in March this year. The TCI is an index used to compare differences before and after the COVID-19 outbreak. With 100 as the baseline, a higher number indicates an increase, and a lower number indicates a decrease. Considering that the consumer price index rose by 11.5% from May 2019 to May this year, actual travel expenses can be seen as having decreased.

An industry insider said, "Due to the impact of global inflation, not only domestically but also those planning overseas trips are prioritizing cost-effectiveness when choosing destinations and selecting schedules for flights, accommodations, and tourist site visits."

This content was produced with the assistance of AI translation services.