Good news for corporate travel advisors: a recent study says a sizeable number of small to medium-sized businesses in Canada are increasing their travel spending.
Despite inflation worries, tariff tensions and tight operating margins, more than four in 10 Canadian small and mid-market enterprises (42%) are spending more on business travel in 2025 than last year, according to a national YouGov survey commissioned by Corporate Traveller Canada, the business travel division of Flight Centre Travel Group.
This sentiment is echoed in Corporate Traveller Canada’s own booking data, showing a 6% increase in domestic and international business travel bookings in Q1 2025 compared to the same period last year.
Company officials said the uptick is being driven primarily by clients in professional services, mining and manufacturing.
“Canadian SMEs are showing quiet optimism as the ‘wait-and-see’ approach is starting to fade,” Chris Lynes, Managing Director for Flight Centre Travel Group Canada, told Open Jaw. “We’re expecting a solid bounce back in transborder travel once a trade deal is reached.
“At the same time, as Canada’s economy continues to diversify, we’re seeing more international deals—and that’s naturally driving an uptick in business travel. In the short term, reduced cross-border air traffic is leading to more competitive pricing from airlines and hoteliers, and many Canadian SMEs are already capitalizing on that,” he said.
“The encouraging sign is that the business pullback we saw over the past year is easing.”
Additional Survey Insights
- Travel Demand Reaching New Heights
- More than four in five SMEs (82%) believe demand for corporate travel will be the same as or higher than pre-pandemic levels over the next 12 months.
- Inflation Fears Loom
- Almost three in four Canadian SMEs (70%) fear that inflation will affect their business’s ability to afford corporate travel.
- Corporate Travel Remains Viable
- Still, taking the current and forecast inflationary environment into account, 15% of SMEs say travel remains highly viable (little to no change) and almost half (48%) say it’s viable, though some reduction may be necessary.
- Smarter Travel Spending
- Over the past 12 months, 84% of Canadian SMEs made more strategic decisions with their travel budgets.
- Opted for cost-effective options (economy class, budget accommodations) - 32%
- Reduced travel frequency - 30%
- Encouraged or mandated advanced bookings to secure lower rates - 28%
- Reviewed and optimized travel policies - 27%
- Set stricter travel expense limits and budgets - 25%
- Negotiated discounts with airlines, hotels, or car rental companies - 24%
- Implemented an approval process for all travel requests - 24%
- Used data analytics or technology (e.g. AI-based tools) to monitor and control travel expenses - 21%
- Over the past 12 months, 84% of Canadian SMEs made more strategic decisions with their travel budgets.
Airfare Prices Offer Short-Term Relief
Although prices for everyday essentials rose year over year by 3.8% in April 2025, businesses are catching a break when it comes to airfare. In March 2025, flight costs dropped 12% YoY and remained down 5.8% in April.
This decline enables companies to reinvest in business travel without absorbing additional cost pressure. With global tariff uncertainty and supply chains in flux, businesses are using travel as a strategic tool to safeguard growth and strengthen key partnerships.
“Our data shows that 55% of Canadian SMEs worry the inflation rate will increase over the next 12 months, yet most aren’t pulling back on travel,” said Lynes, “Instead, they’re optimizing how they travel, leveraging cost controls, smart policies and technology so they can stay agile without sacrificing business growth.”
