Analyzing Fast Casual Market Growth Trends for 2026

Listen to the article 17 min This audio is auto-generated. Please let us understand if you have feedback. Following a year of broad financial uncertainty that stifled growth for hotels, hospitality industry leaders are looking toward 2026 with cautious optimism. Increasing functional costs are slated to challenge owners this year and lower-tier segments could struggle amid a growing wealth bifurcation.

And through everything, hotel business are anticipated to fortify their portfolios with new brand offerings and partnerships. As the year gets underway, Hotel Dive consulted with hospitality leaders from varying corners of the industry about their 2026 forecasts. Below are the leading trends expected to effect hotel operations, efficiency, net system development and more this year.

Overall wages, salaries and benefits paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Accommodations Association, shared with Hotel Dive. In 2026, that figure is projected to climb up to $131 billion, representing a roughly 3% year-over-year boost, per AHLA. For hotel owners, increasing labor expenses posture a challenge to net operating earnings growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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Rising labor expenses have actually been a difficulty for hoteliers for years, Davis said, particularly following the COVID-19 pandemic. Overall, hotel labor costs have actually increased 15.3% from 2019 to 2025, outpacing the 12.8% development in overall operating profits, according to AHLA.

3, 2024 in San Francisco, California. Justin Sullivan by means of Getty Images In 2026, Davis noted, union negotiations will be "front and center" in New york city City, where the New York Hotel and Video gaming Trades Council's union contract with the Hotel Association of New York City City is set to expire in July.

"Need has not kept up with this rate," she stated. Incomes, salaries and payroll-related costs paid by hotels now account for more than 32% of total revenue, according to AHLA.

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As more hotel guests turn to expert system to improve their travel experience, scheduling hotels straight through large language designs (LLMs) may be next, hospitality professionals said. Agentic commerce a process by which self-governing AI agents act on behalf of a consumer to find, compare and finish purchases is a pattern that has actually sped up throughout industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials stated they're likely to utilize AI for travel suggestions. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, informed Hotel Dive. Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct booking, bigger multibrand hotel companies will "embed LLMs into their own brand name websites and mobile apps, and alter the method the customer searches," Kletzel stated.

"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 today consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality item marketing at AI customer experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers need to guarantee their residential or commercial property details is being indexed by LLMs to appear in tourist questions.