The U.S. B2B exhibition industry is gaining momentum after a slight slowdown in the second quarter of 2024, according to the Center for Exhibition Industry Research’s (CEIR) Q3 Total Index report, which assesses the industry’s performance across four key metrics: attendance, square footage net, exponents. , and real incomes.
Published on December 4, the report highlights mixed results, with an increase in net exhibition area and a recovery in exhibitor participation contrasting with a slowdown in revenue and attendance in a favorable economic context hampered by low prices. high and political uncertainty.
Overview of key indicators
After reaching a post-pandemic high of 92.3 in the first quarter of 2024, the index value fell to 87.7 in the second quarter, but rebounded slightly to 88.8 in the third quarter, thanks to improving net floor area (NSF) and exhibitor participation.
The total index for the third quarter of 2024 is 11.2% lower than the same period in 2019, an improvement from the 14.6% decline in the third quarter of 2023. Compared to the third quarter of 2023, the index gained 3.4 percentage points and increased by 1.1 points compared to the second quarter of 2024.
Of the events sampled in the index, 33.8% exceeded their pre-pandemic performance, a significant increase from 25.9% in the third quarter of 2023. The cancellation rate for in-person events remained low at just 0.3%, down from 1.6% in the third quarter of 2023.
“The data shows a continued rebuilding of the exhibitions sector,” said Adam Sacks, president of Tourism Economics, a subsidiary of UK-based independent global consultancy Oxford Economics. “These events remain critical to successful business operations and our business performance forecast supports an outlook for further growth in 2025.”
Performance Breakdown
Looking at the four components of the total index, the net square footage (NSF) measure shows the strongest recovery, currently just 2.7% below pre-pandemic levels compared to 2019. exponents’ measure is down 7.0% compared to the third quarter of 2019, while real revenues, taking into account inflation, are lagging behind with a deficit of 16.3% compared to 2019. Showing the slowest recovery, attendance is down 17.8% (see Figure 2).
Despite falling unemployment and lower interest rates boosting consumer prospects, high prices remain a concern and could impact trade show attendance; for example, the University of Michigan’s consumer confidence index fell from 70.1 to 68.9 in October. Comparing results to events held in the third quarter of 2023, the report cites a similar trend, with NSF maintaining relative strength and lagging attendance.
Economic context
The latest CEIR index results align with positive trends in the U.S. economy, where annualized GDP grew 2.8% in the third quarter, fueled by strong consumer spending. The labor market remains resilient, with slowing inflation supporting growth in real disposable income.
The personal consumption expenditures (PCE) deflator rose 2.3% year-over-year in the third quarter, nearing the Federal Reserve’s 2% target, while real disposable income rose 1.6%. % at an annualized rate in the third quarter.
Following the growth of key economic indicators, the Oxford Economics Business Cycle Indicator (BCI) saw a slight increase from the already high levels at the start of the third quarter (see Figure 3). Despite challenges such as hurricane impacts and a Boeing strike affecting job creation, the unemployment rate remains at 4.1%, and layoffs remain low.
The manufacturing sector is currently one of the weakest sectors of the economy, with industrial production falling year-on-year due to external factors, but expected to improve sustainably in 2025, with the decline interest rates encouraging business investment. Ongoing trends such as advances in artificial intelligence, the CHIPS Act, and the Inflation Reduction Act (IRA) will continue to support growth, mitigating the effects of the previous commercial and industrial lending squeeze , as well as the increase in demand for electricity, are positive signs for this sector.
Although the economic outlook remains positive, high interest rates pose downside risk. Recent inflation reports have been tougher than expected, and the strong employment numbers shift the balance of risks for monetary policy. According to Federal Reserve Chairman Jerome Powell, “the economy is not sending any signals that we need to rush to lower rates.”
Even though CEIR projects a 25 basis point cut in December and three more cuts in 2025, there is a risk that the Fed will implement fewer cuts.
Looking towards 2025
The U.S. economy is expected to outperform other advanced economies next year on labor force growth and strong investment, despite higher tariffs that may not have a significant impact until after end of 2025 or in 2026. Declining immigration (see Figure 4) will also affect the labor market over time. as new immigrants become more integrated, and those who arrived in the past two years will continue to contribute to labor force gains a year after immigration restrictions are put in place.
CEIR expects business equipment spending to increase by more than 5% next year, supported by favorable fundamentals such as past increases in manufacturing investment, favorable fiscal policy, ongoing investments related to AI, relaxation of lending standards and strong economic incentives. Although increased political uncertainty has historically dampened business capital spending, as recession fears ease and help offset some of the uncertainty surrounding trade policies, this drag is expected to be modest.
Travel outlook amid political uncertainty
It is difficult to predict future actions by the Trump administration and Congress, particularly regarding impacts on travel; CEIR predicts a drop in visits from China due to negative rhetoric and retaliatory trade restrictions, as well as a reduction in travel from the Middle East due to similar concerns. Growth in international travel from Canada and Mexico is also expected to decline as tensions rise over new tariffs and stricter immigration enforcement.
“The third quarter 2024 CEIR index reveals a resilient B2B exhibition sector on the path to continued recovery,” said Marsha Flanagan, President and CEO of the IAEE. “Although we are still below 2019 levels, we are seeing encouraging signs of growth. CEIR will launch a benchmarking study of organizers in early 2025, leveraging additional data sets. This research will provide a better understanding of lagging and leading indicators, in order to gain deeper insights and drive advancement in the sector.
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