Hotel bookings for October and November are well behind last year, but the rate of cancellations is slowing, according to the latest figures from Bermuda Hotel Association (BHA).

The industry is also suffering because the late bookings it relies upon to bump up occupancy rates have fallen steeply since the September 11 terrorist attacks in the United States.

Occupancy rates for September slipped to 47 percent. On August 31, just under two weeks before the attacks, Island hotels had bookings showing 56 percent occupancy for September.

BHA president William (Billy) Griffith said last night that the picture was actually worse because late bookings should have pushed occupancy rates to 66-70 percent for September.

Mr. Griffith also revealed that 800 hotel workers have had their hours cut in response to the slowdown, although he was not aware of any layoffs.

"The feedback from some of the smaller properties is that they are seeing a gradual increase in bookings," he said yesterday.

"For most of the medium and larger hotels there is still a percentage of slump or cancellations, but not to the extent it was two or three weeks ago.

"Overall, the occupancy rates are nowhere near what we would have been doing had it been normal business. We've had a fairly sizeable drop for the next quarter.

"There is no tangible pick-up in business because people are not booking vacation or business travel yet, and we depended quite heavily on a 30 day pick-up of business that would increase the numbers substantially, and that's not happening."

On August 31, bookings for October were 49 percent, but these had slumped to 41 percent by September 26. Bookings for November for the same period dropped from 34 percent to 29 percent.

Cambridge Beaches is showing 50 percent occupancy for October when it should be 75 percent. "November didn't receive anywhere near as many cancellations, but the pickup we should be getting has not happened yet," said Cambridge Beaches president Michael Winfield.

Bookings at the Reefs have also slipped. The property had 62-percent occupancy for September compared to a normal 92 percent. The resort is projecting 60 percent for October compared to a normal 90 percent, and 55 percent for November compared to 65 percent.

Neal Stephens, general manager at the Reefs, said: "We've noticed that any new bookings and cancellations are pretty much equalling out. We don't seem to be dropping further back."

The Newstead is cutting back on entertainment and staff hours, but is optimistic about this month and next.

General manager Clarence Hofheins said yesterday: "We are very optimistic. We are going to have a decent October and November is shaping up. We are doing some scaling back but we fully expect to make it through the winter."