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, hospitality industry leaders are looking toward 2026 with cautious optimism. Rising functional costs are slated to challenge owners this year and lower-tier segments might struggle amid a growing wealth bifurcation.

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

Overall salaries, salaries 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 up to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, rising labor costs position a difficulty to net operating income development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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"It is an absolute concern." Increasing labor expenses have actually been an obstacle for hoteliers for many years, Davis said, especially following the COVID-19 pandemic. In general, hotel labor expenses have actually increased 15.3% from 2019 to 2025, outpacing the 12.8% growth in total operating income, according to AHLA. Over the last few years, countless union hotel employees have gone on strike demanding greater salaries in order to keep up with the rising cost of living in places such as California, Hawaii and Las Vegas.

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

"Demand has actually not stayed up to date with this rate," she said. "We're likewise seeing these challenges intensified by legislation that targets hotel operations, such as extreme labor and licensing policies like the New York City City Safe Hotels Act. When demand is falling and expenses are soaring, the math simply doesn't accumulate." Salaries, wages and payroll-related costs paid by hotels now represent more than 32% of overall profits, according to AHLA.

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As more hotel guests turn to artificial intelligence to boost their travel experience, reserving hotels directly through big language models (LLMs) might be next, hospitality professionals stated. Agentic commerce a process by which autonomous AI agents act upon behalf of a consumer to discover, compare and complete 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 stated they're likely to utilize AI for travel suggestions. 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 stay competitive with direct reservation, larger multibrand hotel companies will "embed LLMs into their own brand websites and mobile apps, and alter the way the customer searches," Kletzel said.

"If you are not discoverable in an LLM search engine result which numerous brands aren't, and this is the big panic that they're all going through today consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI client experience platform Talkdesk, similarly informed Hotel Dive that hospitality players need to ensure their home information is being indexed by LLMs to appear in traveler inquiries.