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Canceled Broadway shows. Shuttered restaurants. Lines of people wrapped around the block at walk-in medical clinics. Businesses sending their employees home.
It sounds like a flashback to March 2020. The highly contagious omicron variant is driving a surge of coronavirus infections. In New York, the wave is particularly pronounced, with a seven-day average of new Covid-19 cases nearly doubling over the past week, according to a CNBC analysis of Johns Hopkins University data.
The ability of this variant to break through the defenses of Covid vaccinations has prompted people to rethink everyday activities like eating out at restaurants. That’s put the $100 billion dollar conferences and events industry on edge. The pandemic brought the industry, which revolves around large gatherings of people, to a screeching halt last year, as social distancing measures were enforced.
The conventions industry has been getting back on its feet in recent months. Over the summer, billionaires like Jeff Bezos and Bill Gates retreated to Idaho for Allen & Co.’s Sun Valley conference. And Bitcoin 2021 brought thousands of cryptocurrency enthusiasts to Miami in June.
The Center for Exhibition Industry Research estimated that conferences — which drive business for hotels, airlines and local restaurants — contributed more than $101 billion to U.S. gross domestic product in 2019. CEIR’s Chief Economist Dr. Allen Shaw projected in September that these gatherings would return to about 75% to 80% of 2019 levels next year — with a full recovery by 2023.
But that was before omicron, now the most dominant strain of Covid in the U.S., entered the picture. And so far, event organizers seem to have mixed feelings over whether or not gatherings will proceed as planned next year. Attendance levels will likely depend upon corporate travel policies and venues’ health and safety protocols.
The World Economic Forum, which brings together heads of government and business executives from around the world in Davos, Switzerland, had been scheduled for next month, but was postponed until the summer. The group said it made the decision “in the light of continued uncertainty over the omicron outbreak.”
JPMorgan Chase changed course on its big annual health-care conference after key attendees dropped out on Covid fears. It had intended to hold it in person in San Francisco next month. The event, known as one of the largest gatherings of health-care executives in the world and a hotbed for deals activity for the industry, is now being held in a virtual format.
Increasing Covid protocols
The National Retail Federation, however, said Tuesday that its “Big Show,” scheduled to take place at the Javits Convention Center in New York City from Jan. 16 to Jan. 18, is still a go.
The leading trade group for the retail industry is asking that all attendees be fully vaccinated against Covid-19 and wear masks at all times in the building. NRF is also advising attendees to test themselves for Covid at home before traveling to Javits. The group said it will be offering PCR tests at the convention center during the event.
“Like all of our attendees, we are closely monitoring the external health environment,” said NRF President and Chief Executive Matt Shay, in a statement. “We will continue to work with local, state and federal health officials to ensure we meet and exceed safety guidelines and mandates.”
In a separate email sent to speakers who are lined up for “Big Show,” NRF said that as long as the Centers for Disease Control and Prevention, New York state and Manhattan deem it safe to hold the event, it will go on.
“We do not have plans at this time to go virtual, but if that decision is made, it would likely be on a delayed basis given the complexity of that pivot,” NRF said in the email, which was seen by CNBC.
The Consumer Electronics Show is also still on track to be held in Las Vegas from Jan. 5 to Jan. 8, according to event organizers.
A spokesperson for the event said that CES has received several thousand new registrants since last week, even amid omicron fears. CES is requiring attendees be fully vaccinated and wear masks. It’s also lowering capacity and keeping some social distancing measures in place.
“We are confident that attendees and exhibitors will have a socially distanced but worthwhile and productive event,” said the spokesperson.
Still, major tech companies including Amazon, Meta, Twitter and Pinterest said they won’t be sending teams to CES this year due to Covid fears. While others like Google, Qualcomm and General Motors say they’re still on track to attend and show off new products.
A representative for the Las Vegas Convention Center, where CES is slated to be held, said that there are currently about 45 tradeshows with at least 5,000 attendees on the books at the venue for next year.
‘We’re getting there’
David DuBois, president and CEO of the International Association of Exhibitions and Events, said that so long as the adequate safety measures are taken at these conference venues and local mandates are followed, large-scale events should proceed. And it can then be left up to attendees as to whether or not they feel comfortable attending, he said.
“Over the past several months, the exhibitions industry has demonstrated ways to hold events safely,” said DuBois in a phone interview. “We have had hundreds of them in the last three to four months.”
Even with omicron, DuBois expects the industry to recover, he said.
In Orlando, conference activity really started to pick back up in July before it experienced a slight downtick during the fall due to the delta variant, said Mark Tester, executive director of the Orange County Convention Center. Behind Las Vegas and McCormick Place in Chicago, this is the third-largest convention center in North America.
The pace of conventions tends to slow down over the holidays, said Tester, and so far Orange County Convention Center hasn’t seen any cancellations for January shows. Not only are there financial penalties for calling off these events at this last minute, but it can put a damper on morale in an industry, he said.
“We have not heard any questioning or thoughts of going virtual or doing something with [an] event due to the omicron variant,” said Tester. “It may effect some attendance. … But we work with everyone on their protocols.”