Targeting Profitable Business Ventures in 2026

, hospitality market leaders are looking toward 2026 with cautious optimism. Rising functional expenses are slated to challenge owners this year and lower-tier sectors might struggle amidst a growing wealth bifurcation.

And through all of it, hotel companies are anticipated to strengthen their portfolios with brand-new brand name offerings and collaborations. As the year gets underway, Hotel Dive talked to hospitality leaders from varying corners of the industry about their 2026 predictions. Below are the leading patterns anticipated to impact hotel operations, performance, net unit growth and more this year.

Overall salaries, salaries and advantages paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Lodging Association, shown Hotel Dive. In 2026, that figure is forecasted to climb to $131 billion, representing an approximately 3% year-over-year boost, per AHLA. For hotel owners, increasing labor costs pose an obstacle to net operating earnings development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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"It is an absolute concern." Increasing labor costs have been a challenge for hoteliers for many years, Davis said, particularly following the COVID-19 pandemic. In general, hotel labor costs have actually increased 15.3% from 2019 to 2025, outpacing the 12.8% development in overall operating revenue, according to AHLA. In the last few years, countless union hotel workers have actually gone on strike demanding greater incomes in order to stay up to date with the increasing cost of living in locations such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan through Getty Images In 2026, Davis kept in mind, union settlements will be "front and center" in New York City, where the New York City Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City is set to expire in July.

Last year, the union backed New york city City's recently elected Mayor Zorhan Mamdani, who operated on a guarantee to raise New york city City's base pay to $30 per hour by 2030. Hotel industry associations, consisting of AHLA, have knocked similar legislation across the nation, consisting of the recently passed $30 wage ordinance in Los Angeles. "Demand has not kept up with this rate," she stated. Incomes, wages and payroll-related expenditures paid by hotels now account for more than 32% of total revenue, according to AHLA.

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As more hotel visitors turn to synthetic intelligence to boost their travel experience, scheduling hotels directly through big language models (LLMs) may be next, hospitality professionals said. Agentic commerce a process by which autonomous AI agents act upon behalf of a customer to discover, compare and finish purchases is a trend that has actually sped up across industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials said they're likely to use AI for travel recommendations. A smaller percentage (57%) stated they 'd be most likely to utilize it for scheduling travel. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, told Hotel Dive. "The variety of customers that are browsing [through LLMs] for products and services in travel has ballooned in the last 12 months and is speeding up every day," Kletzel stated, including that inevitably, hotels will "take a tough look at how they can enable commerce and deals through agentic [AI]"" [Brands] can construct on the trust they already have if they do a terrific task with how they manage AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To stay competitive with direct booking, larger multibrand hotel companies will "embed LLMs into their own brand sites and mobile apps, and change the way the consumer searches," Kletzel said.

"If you are not discoverable in an LLM search result which numerous brands aren't, and this is the big panic that they're all going through right now consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI consumer experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers require to ensure their home information is being indexed by LLMs to appear in traveler inquiries.