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, hospitality industry leaders are looking towards 2026 with mindful optimism. Increasing functional expenses are slated to challenge owners this year and lower-tier segments could have a hard time in the middle of 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 consulted with hospitality leaders from varying corners of the market about their 2026 forecasts. Below are the top trends expected to impact hotel operations, efficiency, net system growth and more this year.

Total salaries, incomes and benefits 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 forecasted to reach $131 billion, representing a roughly 3% year-over-year increase, per AHLA. For hotel owners, rising labor costs present a challenge to net operating earnings development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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"It is an outright concern." Rising labor costs have been a difficulty for hoteliers for many years, Davis said, particularly following the COVID-19 pandemic. Overall, hotel labor costs have increased 15.3% from 2019 to 2025, outmatching the 12.8% growth in total operating profits, according to AHLA. In the last few years, thousands of union hotel workers have actually gone on strike demanding higher earnings in order to stay up to date with the increasing cost of living in places such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan through Getty Images In 2026, Davis noted, union settlements will be "front and center" in New York City, where the New York Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City City is set to expire in July.

"Need has not kept up with this rate," she stated. "We're also seeing these challenges compounded by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City Safe Hotels Act. When need is falling and expenses are skyrocketing, the mathematics just does not build up." Salaries, earnings and payroll-related expenditures paid by hotels now account for more than 32% of total profits, according to AHLA.

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As more hotel visitors turn to expert system to boost their travel experience, reserving hotels directly through large language designs (LLMs) might be next, hospitality experts said. Agentic commerce a procedure by which autonomous AI representatives act upon behalf of a customer to discover, compare and complete purchases is a pattern that has sped up across markets like retail.

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

"If you are not visible in an LLM search result which lots of brands 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 item marketing at AI client experience platform Talkdesk, similarly informed Hotel Dive that hospitality gamers need to ensure their home info is being indexed by LLMs to appear in traveler inquiries.