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Listen to the article 17 min This audio is auto-generated. Please let us know if you have feedback. Following a year of broad economic uncertainty that suppressed development for hotels, hospitality industry leaders are looking towards 2026 with careful optimism. Increasing operational costs are slated to challenge owners this year and lower-tier sections could have a hard time amidst a growing wealth bifurcation.

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

Total salaries, salaries and advantages paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Lodging Association, shared with Hotel Dive. In 2026, that figure is projected to climb up to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, rising labor expenses posture a challenge to net operating income development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

Key Global Milestones in Hospitality Development

"It is an absolute issue." Increasing labor costs have been a challenge for hoteliers for many years, Davis said, especially following the COVID-19 pandemic. Overall, hotel labor expenses have actually increased 15.3% from 2019 to 2025, surpassing the 12.8% growth in total operating profits, according to AHLA. In current years, countless union hotel workers have gone on strike demanding greater earnings in order to keep up with the rising cost of living in locations such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan through Getty Images In 2026, Davis kept in mind, union negotiations will be "front and center" in New york city City, where the New York Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City City is set to end in July.

In 2015, the union backed New York City's freshly elected Mayor Zorhan Mamdani, who operated on a guarantee to raise New York City's base pay to $30 per hour by 2030. Hotel market associations, including AHLA, have denounced comparable legislation across the country, consisting of the recently passed $30 wage regulation in Los Angeles. "Demand has not kept up with this rate," she stated. Salaries, salaries and payroll-related expenses paid by hotels now account for more than 32% of total earnings, according to AHLA.

Strategic Steps for Hospitality Brand Expansion

As more hotel guests turn to synthetic intelligence to improve their travel experience, reserving hotels straight through big language models (LLMs) might be next, hospitality experts said. Agentic commerce a procedure by which autonomous AI representatives act on behalf of a customer to find, compare and finish purchases is a pattern that has accelerated throughout industries like retail.

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According to PwC's 2025 Vacation Outlook report, 76% of millennials stated they're most likely to use AI for travel suggestions. A smaller sized portion (57%) stated they 'd be likely to utilize it for reserving travel. However that number is growing, Jonathan Kletzel, PwC's travel, transport and logistics leader, informed Hotel Dive. "The variety of consumers that are searching [by means of LLMs] for products and services in travel has actually ballooned in the last 12 months and is accelerating every day," Kletzel stated, adding that inevitably, hotels will "take a tough take a look at how they can make it possible for commerce and deals through agentic [AI]"" [Brands] can build on the trust they currently have if they do an excellent task with how they deal with AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct booking, larger multibrand hotel companies will "embed LLMs into their own brand sites and mobile apps, and alter the way the customer searches," Kletzel stated.

"If you are not visible in an LLM search results page which many brands aren't, and this is the big panic that they're all going through right now consumers aren't going to consider you," he stated. Michael Klein, head of retail, travel and hospitality product marketing at AI customer experience platform Talkdesk, likewise told Hotel Dive that hospitality gamers require to guarantee their residential or commercial property info is being indexed by LLMs to appear in traveler inquiries.