The cost of living has squeezed almost every part of household spending — but the annual holiday is proving remarkably resistant. ABTA's latest Holiday Habits report, based on a survey of 2,082 UK adults, found 88% of respondents had taken a break in the past 12 months, matching pre-pandemic levels, and 70% intend to head abroad in the coming year.
What's changing is how people pay for it. Only 7% said rising costs would stop them travelling altogether. Instead, holidaymakers are trimming elsewhere: half would cut back on eating out, 38% on leisure activities and 37% on clothes, while just under a third would rein in overseas holiday spending. Once away, 21% plan to book cheaper accommodation and 19% intend to dine out less.
Value is driving booking behaviour too. Package holidays are back in favour, taken by 63% of those who travelled abroad — up two points on the year — and bookings through travel agents climbed from 34% to 38%. The appeal is straightforward: ease of booking, clear value for money, and someone to call when things go wrong. ABTA chief executive Mark Tanzer said demand has held up well despite a tricky year, with the Middle East conflict disrupting routes and fuelling prices, Europe's new Entry/Exit System adding friction, and climate events playing havoc with plans.
On destinations, Europe remains dominant, drawing 84% of British overseas holidaymakers, with North America on 20%, Asia 15% and Africa 13%. City breaks have overtaken the beach as the most popular holiday type, rising six points to 53% against 49% for beach trips, though families with children still favour the sand at 57%. Wellness breaks are creeping up to 9% of the market.
Cruises are another quiet growth story. They held steady at 13% of holidays taken, but 17% of respondents say they're considering one in the next year, and nearly a quarter of families with children under five have already cruised. The reasons mirror the package boom: 52% cite value for money, and 40% like paying the essentials upfront with no nasty surprises later.
Spending intentions tell a slightly cautionary tale. Some 32% plan to spend more on holidays next year, down from 34% — and ABTA notes much of that increase reflects higher prices rather than extra trips. In other words, people aren't travelling more; they're paying more for similar holidays and adapting around the edges.
For travellers, the takeaway is clear: the industry knows demand is resilient, so deals will favour those who book smart. Package deals and agents are regaining ground because they bundle costs and offer protection — worth considering if budget certainty matters more than total flexibility. Expect queues at European borders as the Entry/Exit System beds in, and consider travelling shoulder-season if rising prices are a concern. For anyone in the trade, the message is equally plain: Brits will protect the holiday budget, but they're shopping harder for value than at any point since the pandemic.
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