Online Travel Reservation Services NAICS 561599
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Industry Summary
The 1,532 online travel reservation service providers facilitate travel purchases between travelers and a wide range of travel resources, including airline seats, lodging, rental cars, and tours. Through websites and mobile applications, online travel agencies (OTA) use proprietary technology to streamline the travel booking process and provide a one-stop platform for researching, comparing, and reserving travel services. Lodging reservations account for the vast majority of revenue.
Dependence on Changing Technology
OTAs depend on sophisticated technology to support and enable customer interaction and manage data from different travel suppliers on a single platform.
Travel Industry Recovery Ongoing
US spending on travel has nearly fully recovered from the pandemic.
Recent Developments
Jun 15, 2026 - Americans' Summer Travel Plans Show an Affordability Gap
- Rising airfares and hotel prices are widening the gap between Americans who can afford summer travel and those who cannot. According to Deloitte, only 45% of Americans have made summer travel plans, the lowest level in six years, while participation among households earning $100,000 to $199,000 fell to 37% from 45% a year ago. Airlines report strong demand from affluent travelers, even as budget-conscious consumers delay bookings, switch to domestic destinations, or opt for cruises and road trips. Airfares jumped more than 20% year over year in April, according to US government data, while outbound international bookings are down 25%, according to travel agency network InteleTravel. Despite healthy overall travel demand, industry executives and economists say it masks a growing divide between travelers who can absorb higher costs and those increasingly priced out of traditional summer vacations.
- Gen Z and millennials make up about half of all US travelers, with Gen Z’s share climbing from 8% in 2024 to 14% in 2025, according to Deloitte’s latest Travel Industry Outlook. Even with lower earnings, both generations travel at higher rates than older cohorts. How they plan and book trips is also changing the playbook: social media (especially short-form video) has become a primary discovery tool, and sustainability considerations increasingly influence lodging and transportation choices. Digital engagement matters more across the journey, from inspiration to booking to in-trip experiences. Millennials are leading in the use of AI for trip planning and tend to associate “luxury” with food-driven, family-friendly experiences. Gen Z, meanwhile, defines luxury around comfort, wellness, and amenities such as fitness and spa offerings. Together, these preferences are pushing travel and hospitality brands toward more digital-first marketing and personalized experiences designed to meet younger travelers where they are.
- International travel to the US fell in 2025 as global tourism grew, making it the only major destination seeing a decline in international visitors, according to the US Travel Association. Inbound travel dropped about 4% year over year - 11 million fewer visitors and a $50 billion hit to airlines, hotels, restaurants and attractions - while worldwide tourism rose about 4% (per the International Travel Association). The slide reflects a sharp shift in US entry policy under Trump, including expanded travel bans, widespread visa suspensions, and broader social-media vetting, measures that industry groups say have made the US feel less welcoming to foreign travelers. Those policies, coupled with confrontational rhetoric toward allies, have dampened demand from key markets of Canada, Europe and parts of the Middle East. Travel leaders warn the resulting slump could have lasting consequences for US competitiveness, even with potential tailwinds from events like the 2026 FIFA World Cup.
- Riding a significant bounce back after the pandemic, wages in the travel arrangement and reservation industry have been climbing steadily, outpacing growth in most other sectors. High demand after the pandemic, specialized expertise, and a tight labor market are combining to push both short- and long-term wages higher in online travel services. Nonsupervisory employees now earn $33.85 per hour, a 3.6% year-over-year boost in April (Bureau of Labor Statistics) Rising online travel bookings required companies to retain and hire experienced staff to handle the increased workflow. And while inflation also accounts for a small portion of the increase, a significant share comes from the growing value of digital and customer service skills, like managing complex itineraries and navigating booking platforms. Over the past decade, wages have risen nearly 55%, faster than the 50% increase for all private nonsupervisory positions, driven by long-term expansion, tech adoption, and competition for skilled employees.
Industry Revenue
Online Travel Reservation Services
Industry Structure
Industry size & Structure
The average online travel reservation service provider operates out of a single location, employs about 40 workers, and generates about $15 million annually.
- The online travel reservation services industry consists of about 1,530 firms that employ about 60,450 workers and generates $23.4 billion annually.
- The industry is concentrated with the top 50 companies accounting for about 70% of industry revenue.
- Large companies include Booking.com, Airbnb, Expedia, and AAA.
- Household consumers and individuals account for almost 60% of industry revenue, businesses account for 23%, and travel agencies and other resellers account for 16%. Less than 3% of establishments are franchises.
- Because of the global nature of travel, large firms typically have operations in foreign countries.
Industry Forecast
Industry Forecast
Online Travel Reservation Services Industry Growth
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