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, hospitality industry leaders are looking toward 2026 with careful optimism. Rising functional expenses are slated to challenge owners this year and lower-tier sections might have a hard time amidst a growing wealth bifurcation.

And through it all, hotel companies are anticipated to fortify their portfolios with brand-new brand name offerings and partnerships. As the year gets underway, Hotel Dive spoke with hospitality leaders from varying corners of the industry about their 2026 predictions. Below are the leading patterns expected to impact hotel operations, performance, net system growth and more this year.

Overall salaries, earnings and advantages paid by U.S. hotels rose to $127 billion in 2025, according to data from the American Hotel & Lodging Association, shared with Hotel Dive. In 2026, that figure is predicted to climb up to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, increasing labor costs posture a difficulty to net operating income growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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"It is an absolute issue." Rising labor costs have actually been an obstacle for hoteliers for many years, Davis said, particularly following the COVID-19 pandemic. Overall, hotel labor expenses have increased 15.3% from 2019 to 2025, outpacing the 12.8% growth in total operating income, according to AHLA. Recently, thousands of union hotel workers have actually gone on strike requiring greater salaries in order to keep up with the increasing expense 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 noted, union settlements will be "front and center" in New York City, where the New York City Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City City is set to expire in July.

In 2015, the union backed New york city City's newly elected Mayor Zorhan Mamdani, who worked on a pledge to raise New york city City's base pay to $30 per hour by 2030. Hotel industry associations, including AHLA, have denounced comparable legislation across the country, consisting of the just recently passed $30 wage regulation in Los Angeles. "Demand has not kept up with this rate," she stated. Incomes, earnings and payroll-related costs paid by hotels now account for more than 32% of overall profits, according to AHLA.

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As more hotel visitors turn to synthetic intelligence to boost their travel experience, reserving hotels directly through large language models (LLMs) might be next, hospitality specialists said. Agentic commerce a procedure by which self-governing AI representatives act upon behalf of a customer to find, compare and finish purchases is a trend that has sped up throughout industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials said they're most likely to use AI for travel recommendations. That number is growing, Jonathan Kletzel, PwC's travel, transport and logistics leader, told Hotel Dive. Michael Klein Head of retail, travel and hospitality item marketing at Talkdesk To remain competitive with direct booking, larger multibrand hotel companies will "embed LLMs into their own brand name sites and mobile apps, and change the way the consumer searches," Kletzel said.

"If you are not discoverable in an LLM search result which lots of brand names aren't, and this is the huge panic that they're all going through right now consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI consumer experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers need to guarantee their residential or commercial property info is being indexed by LLMs to appear in traveler questions.