More travelers skip a Labor Day getaway

@CNNMoney August 24, 2011: 5:12 AM ET

NEW YORK (CNNMoney) -- The lousy economy has put a damper on travel plans for this Labor Day weekend, according to a report released Wednesday.

Motorist group AAA expects a total of 31.5 million Americans to travel at least 50 miles away from home between September 1 and September 5. That's down 2.4% from last year, when 32.3 million Americans traveled for Labor Day.

"AAA is projecting a decrease in the number of Labor Day travelers as some Americans react to recent economic uncertainty and increasing air fares," said Glen MacDonell, director of travel services.

The gloomy outlook for the economy is weighing on consumer confidence according to the report, which was produced in cooperation with IHS Global Insight. In particular, it says consumers' discretionary income has not risen enough to keep up with rising travel costs.

Despite the anticipated decline in overall travel, the number of Americans traveling by car over Labor Day weekend is expected to edge up 0.5% to 27.3 million.

Car deals coming in the fall

MacDonell said that number could be higher if gasoline prices continue to fall over the next few weeks.

"We could see an increase in last-minute holiday weekend travel," he said.

Gas prices have fallen about 10% since May, when prices spiked due to turmoil in the Middle East. As a result, nearly three out of every four drivers said gas prices would not impact their Labor Day travel plans, according to AAA.

But prices are still high by historical standards. The national average gas price stands at about $3.57 a gallon, up 86 cents versus last year.

By contrast, rising airfares are expected to crimp air travel over Labor Day weekend, with airfares up 13% compared from last year. The lowest average airfare for a round-trip ticket on one of the main U.S. routes was $202, according to AAA.

The group expects air travel to drop 1.9% to 2.5 million passengers this year.

The report also showed that Americans plan to stay closer to home this year, but will spend about the same amount of money.

Consumers are expected to travel an average of 608 miles, down from 635 last year. The median spending level is expected to be $702, compared with $697 last year.

While fuel and transportation costs should be the biggest expense for travelers, the report said spending on accommodations will also take a big bite out of consumers' travel budgets.

According to AAA, travelers will pay an average of $148 to stay at higher-end hotels over Labor Day weekend. That would be up from 6% from $139 last year. Lower-end hotels are expected to cost $110 per night.

Meanwhile, rental car rates for the holiday weekend are expected to average $43 a day, down 7% from 2010. To top of page

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