Mark Renders/Getty Images
Even though the price of gas has dropped an average of $1.50 since last year, the number of Americans hitting the highways this Memorial Day weekend is expected to rise only about 1.5 percent over last year.
Even though the price of gas has dropped an average of $1.50 since last year, the number of Americans hitting the highways this Memorial Day weekend is expected to rise only about 1.5 percent over last year. Mark Renders/Getty Images
A lot has changed in a year: Memorial Day 2008 saw gasoline prices at or near $4 a gallon, as the term "staycation" crept into the nation's pop lexicon. The Dow was around 12,500.
A year later, AIG and Bernie Madoff are household names, and the price of gas is down sharply. But so is Americans' sense of financial security.
So what does that mean for holiday traffic this year?
The American Automobile Association is predicting an increase in holiday travel compared with last year, but that bump "comes from a much lower level than in past years," says AAA spokesman Geoff Sundstrom.
"Last year was very, very weak," he says.
Even though the price of gas has dropped an average of $1.50 since last year, the economic recession has beaten down any substantial increase in holiday travel, Sundstrom says.
An estimated 32.4 million people, or about 1 in 10 Americans, will head out over the holiday weekend, AAA says. The highways will be a bit more clogged this year, with about 27 million Americans on the road, a 1.5 percent increase from 2008. But the skies will be clearer as just 2.1 million people are expected to fly to their vacation destination, a drop of 1 percent from last year.
Sundstrom says AAA's travel forecast is based on an April survey of 2,700 households and how many people said they planned to travel at least 50 miles from home over the holiday weekend. The results were weighed against what surveyors figure is the difference between what people say and what they actually do. Finally, he says, the latest consumer confidence figures, retail sales and any other breaking economic data were factored in.
Gas prices have fallen significantly over last year, Sundstrom says. A year ago, for example, prices at the pump averaged $3.95 in Washington, D.C., and Fort Wayne, Ind., and $4.01 in Los Angeles. This year, they're at $2.49, $2.30 and $2.64, respectively.
But he still thinks they're higher than they should be. Even with the summer driving season upon us, leisure travel doesn't account for all that much in the way of fuel consumption, he says.
"The larger point is that the recession has caused a sharp downturn in commercial traffic," he says. "Just think, all those trucks, all that construction equipment off the roads, fewer sales calls. That's where all the missing demand is, and gas prices don't really reflect that right now."
Prices also may be higher because oil refineries, trying to make money just like any other business, are taking in less oil owing to the glut in gas, and those cutbacks are showing up at the pump.
Meanwhile, the recession has clobbered the airline industry, driving down fares by about 12 percent from a year ago, says Tracey Weber, the North American president for Travelocity.com.
NPR wire services contributed to this report