In Manhattan, New York, the average price for a one-night hotel stay is expected to top 600,000 won. With the North and Central America World Cup and the summer vacation peak season approaching, a wave of price hikes is spreading across the U.S. hotel industry. Analyses are piling up that travel to major U.S. cities is increasingly turning into a luxury good for a small, high-income minority.
The Wall Street Journal (WSJ) reported on the 27th that New York hotel owners, two weeks before the opening of the FIFA World Cup, signed an eight-year deal with the hotel union to raise wages by about 50% to avoid a large-scale strike. Under the agreement, a housekeeper working full time at a unionized hotel in New York will earn more than $100,000 (about 150 million won) a year by 2032. That is close to three times the average annual pay of $34,650 (about 52 million won) for cleaners across the United States, as tallied by the U.S. Bureau of Labor Statistics. The Hotel Association of New York City estimated that the deal would increase hotel operating costs by about 15% per year. Taking that into account, it is the most expensive union contract in U.S. hotel industry history.
The Hotel and Gaming Trades Council is considered the most powerful bargaining organization in the U.S. lodging industry. Unlike manufacturing, hotels rely entirely on on-site staff for room cleaning, front desk, food and beverage, and facilities management. In New York in particular, where rent, taxes, and insurance premiums are high, increases in labor costs are passed on to room rates quickly.
New York hotel prices are already the most expensive in the United States. According to CoStar, a commercial real estate analytics firm, New York's average daily rate in 2025 was $333.71 (about 500,000 won), the highest among the 25 largest U.S. hotel markets. That is more than double the U.S. average hotel daily rate of $160.54 (about 240,000 won). Occupancy was also No. 1 in the United States at 84.1%. The rate that consumers actually pay is much higher than the officially tallied average daily rate. On top of the average rate come New York City's 5.875% hotel occupancy tax, a $2-per-room nightly flat fee, New York State's $1.50 unit fee, and sales taxes. The actual out-of-pocket price for one average room per night is about $387 (about 580,000 won).
If hotels add 15% to room rates to reflect higher labor costs under the new contract, the all-in perceived price with taxes jumps to about $444 (about 670,000 won). For a four-night family trip, that means paying about $230 (about 350,000 won) more just for lodging.
David Sherwyn, director of the Center for Innovative Hospitality Labor and Employment Relations at Cornell University, told the WSJ, "When expense goes up, the only way to protect profits is to keep raising rates," adding, "The question is how much demand can bear higher prices." Thanks to high-income demand, luxury hotels face less price resistance, but analysts say mid- to lower-priced hotels in New York will face strong pressure to pass on costs.
The New York–New Jersey area will host eight World Cup matches, including the final. CoStar data show that in the next month when the World Cup begins, New York City hotel occupancy remained about 12 percentage points lower than the same period a year earlier.
The wave of wage hikes in the hotel industry that began in New York is expected to spread across the United States. Experts said that in large, expensive U.S. cities with many tourists, hotel unions are likely to emerge one after another demanding the same terms as New York. The Los Angeles City Council, the host of the 2028 Olympics, has already passed a local government ordinance to phase in a $30-an-hour minimum wage for hotel and airport workers by 2028, dubbed the "Olympic wage." Philadelphia, ahead of the World Cup kickoff, raised the wages of some downtown hotel workers in one go from $19 to $30 an hour. Industry outlet Hotel Dive assessed that "the New York deal has set a new baseline for hotel workers to bring to the table in union cities like LA, Chicago, Boston, and Hawaii."
Consumers' perceived burden has already hit a limit. In a 2026 summer travel survey by Deloitte Touche Tohmatsu Limited (DTTL), 45% of Americans planned vacations with paid lodging, the lowest in six years. Among non-travelers, 32% said "travel is too expensive," and 35% said "it's hard to afford." Expected average expenditure per traveler was $4,069 (about 6.1 million won), up 17% from a year earlier. Bank of America (BofA) Institute analyzed card data and noted, "About 40% of low-income Americans have no plans for domestic travel this summer, and their card spending on airfares, lodging, and attractions has also fallen from a year ago."
When high hotel prices suppress travel demand, the shock does not stop at city restaurants or around tourist sites. John Fitzpatrick, owner of the Fitzpatrick Hotel Group, told the WSJ, "We tried to design packages bundling flights and rooms during the World Cup, but gave up because the match ticket prices were too high." Canada's TD Economics said in a report this month, "The ripple effects of reduced travel are widespread. They threaten jobs in the hotel, airline, retail, and education institutional sector, and will pull down hotel and local government tax revenues together."