Los Angeles, CA (PRWEB) September 12, 2012
The recession gave the Hospitality Management Schools industry a substantial boost. As unemployment climbed to unprecedented levels, Americans flocked back into classrooms to obtain and enhance their skills. Industry revenue jumped a healthy 7.1% in 2008, followed by an even stronger 9.7% in 2009. Meanwhile, the swaths of the workforce in downstream hotels and motels have retired, creating a gap to be filled by new managers. As a result, industry revenue has grown at an average annual rate of 7.3% from 2007 to 2012, totaling an expected $541.9 million by the end of the year, according to IBISWorld industry analyst Nikoleta Panteva. As economic conditions improve through 2012 and travel becomes more prevalent throughout the United States, demand from downstream industries will climb, pushing up revenue 4.2% during the year. Industry profit, measured as earnings before interest and taxes, has also benefited from the rising demand for hospitality management. As industry participants offer more courses, they are able to spread fixed costs across a larger number of students, reducing per-unit expenses and increasing profitability. IBISWorld estimates that profit margins have grown from 2007 to 2012.
The Hospitality Management Schools industry also experienced physical growth. The number of institutions participating in the Hospitality Management Schools industry has expanded at an annualized rate of 4.2% from 2007 to 2012 to just fewer than 200 campuses. Growing revenue and profit prospects have been attractive to establishments that previously did not offer hospitality degrees. The same drivers are likely to sustain industry establishment growth over the next five years as well; IBISWorld anticipates the number of participants will grow at an average of 1.7% per year to 214 by 2017, Panteva says.
As the economy continues to recover, the Hospitality Management Schools industry will also continue to grow. While the main driver for growth will no longer be high national unemployment, factors like rising downstream demand and continuous technology advancements will keep students pursuing these specialty degrees. Downstream hotels are increasingly catering to consumers through enhanced customer service (via boutique hotels) and widening ranges of offerings (e.g. spas and restaurants). These changes, which require specially trained staff members, are forecast to push revenue up over the five years to 2017. The Hospitality Management Schools industry has a low level of concentration and the industry highly fragmented. The 197 US programs offer a range of traditional and online hospitality management programs that prevents enrollment, and consequently industry operators, from achieving significant market share. For more information, visit IBISWorld’s Hospitality Management Schools in the US industry report page.
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IBISWorld industry Report Key Topics
Schools in this industry offer career vocational courses in hospitality management. The degrees offered can be associate, bachelor’s, master’s or doctorate degrees. Degrees can cover event, restaurant and hotel management.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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