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, hospitality market leaders are looking toward 2026 with careful optimism. Increasing operational expenses are slated to challenge owners this year and lower-tier segments might have a hard time amid a growing wealth bifurcation.

And through it all, hotel companies are expected to fortify their portfolios with brand-new brand offerings and collaborations. As the year gets underway, Hotel Dive talked with hospitality leaders from differing corners of the industry about their 2026 forecasts. Below are the leading patterns anticipated to effect hotel operations, efficiency, net unit development and more this year.

Total wages, wages and advantages paid by U.S. hotels increased 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 to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, increasing labor costs present an obstacle to net operating earnings growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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"It is an outright concern." Rising labor costs have actually been a difficulty for hoteliers for many years, Davis said, particularly following the COVID-19 pandemic. In general, hotel labor costs have increased 15.3% from 2019 to 2025, surpassing the 12.8% development in overall operating earnings, according to AHLA. Recently, thousands of union hotel workers have gone on strike requiring greater salaries in order to stay up to date with the rising cost of living in places such as California, Hawaii and Las Vegas.

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

In 2015, the union backed New york city City's recently chosen Mayor Zorhan Mamdani, who ran on a pledge to raise New York City's minimum wage to $30 per hour by 2030. Hotel industry associations, consisting of AHLA, have actually knocked comparable legislation across the nation, including the recently passed $30 wage regulation in Los Angeles. "Need has not kept up with this speed," she said. "We're also seeing these challenges intensified by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City City Safe Hotels Act. When need is falling and costs are skyrocketing, the math just does not include up." Wages, salaries and payroll-related costs paid by hotels now account for more than 32% of overall earnings, according to AHLA.

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As more hotel guests turn to synthetic intelligence to boost their travel experience, scheduling hotels directly through large language models (LLMs) might be next, hospitality experts stated. Agentic commerce a procedure by which autonomous AI representatives act upon behalf of a consumer to find, compare and finish purchases is a trend that has actually accelerated throughout markets like retail.

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According to PwC's 2025 Vacation Outlook report, 76% of millennials said they're likely to utilize AI for travel suggestions. A smaller sized percentage (57%) stated they 'd be most likely to utilize it for booking travel. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, informed Hotel Dive. "The variety of customers that are browsing [via LLMs] for products and services in travel has actually ballooned in the last 12 months and is speeding up every day," Kletzel said, adding that inevitably, hotels will "take a difficult appearance at how they can allow commerce and transactions through agentic [AI]"" [Brands] can build on the trust they currently have if they do a great task with how they deal with AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To stay competitive with direct reservation, larger multibrand hotel business will "embed LLMs into their own brand name websites and mobile apps, and alter the method the customer searches," Kletzel said.

"If you are not discoverable in an LLM search result which numerous brand names aren't, and this is the huge panic that they're all going through right now customers aren't going to consider you," he stated. Michael Klein, head of retail, travel and hospitality item marketing at AI client experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers require to ensure their home details is being indexed by LLMs to appear in tourist inquiries.