In a study published earlier this month, Deloitte found that although business travel in the U.S. and Europe was continuing to recover, the sector “likely faces a limited upside”—and employers are going to remain choosy about how often they’re willing to book trips for staff.

Analysts at the accounting giant polled 334 corporate travel managers—executives with travel budget oversight—in five countries, including the U.S., in February 2023.

In the first half of 2023, spending on corporate travel was expected to surpass half of 2019 levels, and by the end of the year it was expected to reach two-thirds of pre-pandemic levels, the findings suggested.

Live events, like conferences, were expected to drive the business travel recovery in 2023, with more than half of the travel managers surveyed expecting industry events to reignite business travel.

However, the prognosis for regular business trips didn’t look so good, according to the study.

The findings showed that while spending on business travel was likely to recover to 2019 levels by late 2024 or early 2025, the frequency of work trips was unlikely to fully recover.

“Adjusting for lost growth and inflation indicates that in real terms, corporate travel will likely be smaller than it was prior to the pandemic,” Deloitte’s analysts said.

ESG initiatives were also likely to put a cap on how many trips employers would be willing to send their staff on in the future, the report said.

“Climate concerns will likely put a cap on corporate travel gains for several years to come. Four in 10 European companies and a third of U.S. companies say they need to reduce travel per employee by more than 20% to meet their 2030 sustainability targets,” its authors wrote.

Economic pressure

“As trip volume increases, travel managers face high prices, tough supplier negotiations, and sustainability mandates,” Deloitte’s experts said in their report.

They noted that while leisure travel had returned to pre-pandemic levels months ago, corporate travel was struggling to stage a similar recovery.

“Decisions about these trips face an entirely different calculus, accounting for a host of factors: traveler safety and willingness to board a flight; client interest in meeting in person; the value of attending a conference; and whether a virtual conferencing platform can replace the trip—just to name a few,” Deloitte’s analysts explained.

While the easing of COVID-induced travel rules in many countries made traveling for business much simpler in the second half of last year, analysts said that these travel-friendly changes were competing with macroeconomic uncertainty when it came to swaying companies’ decisions on whether to reintroduce business trips.

More recently, economic anxiety driven by concerns about a looming recession has been exacerbated thanks to banking crises in both the U.S. and Europe, the report’s authors noted, while inflated travel costs—thanks to surging demand and staff shortages in the tourism sector—“fit awkwardly with travel buyers’ seemingly cautious financial approach.”

The rise of ‘bleisure’ travel

While Deloitte’s predictions set a grim scene for the corporate travel landscape, one industry insider said the accounting giant’s outlook did not necessarily apply to business travel as a whole.

Kieran Hartwell, managing director of corporate travel at English travel agency Travel Counsellors, told Fortune that while he understood the shift toward travel cost reduction at large multinational firms, he was seeing small companies continue to invest in business travel.

This, he said, was a strategy small firms were using “as a key pillar for growing their business overseas and investing in face-to-face, human relationship building, aiding both growth and retention of existing relationships.”

Business travel bookings among Travel Counsellors’ small-business clients had returned to pre-pandemic levels in 2022, and in 2023 were already 59% higher than those in 2019, he said.

“There has been a particular focus on travel to North America and Europe, both with extended trip durations, suggesting clients are stacking multiple meetings into each journey and younger employees are extending through weekends to take advantage of ‘bleisure’ opportunities,” he said.

Emil Martinsek, CMO of Berlin-based travel agency GetYourGuide, agreed that post-COVID, there had been a big rise in “bleisure” travel—a mixture of business and leisure travel.

“Even while traveling to meet clients, connect with business partners, or even working remotely, our customers are increasingly looking to maximize the experiences on their [business] trips,” he said in an email.

Business travel ‘will never recover’

While Hartwell and Martinsek expressed optimism about the future of business travel, Robert Blaszczyk, head of the strategic clients department at currency exchange startup Conotoxia, told Fortune that he agreed with Deloitte’s forecasts.

“Today, when the threat of coronavirus no longer forces remote work or prevents private or business travel, the solutions adopted at the height of the pandemic still work,” he said, arguing that handling things remotely that once would have required a business trip was “cheaper, faster, safer and easier.”

“Employees do not have to break away from their daily activities for a few days, and the employer does not have to spend money on tickets, allowances, or hotels,” he added. “In the past, online meetings concerning serious issues were not so natural for us—now they are. That’s why, in my opinion, business travel will not disappear, but it will never recover to pre-COVID levels.”