The U.S. economic recovery depends heavily on our tourism sector, which is still experiencing serious long-term damage as international visitors keep disappearing. In 2024, the country only had about 72 million foreign visitors. This staffing number is especially troubling, given that it is behind the 78 million tracked in 2019. The bad news is that industry leaders are looking up at the sounds of alarm falling upon this decline. Geoff Freeman, president and CEO of the U.S. Travel Association, describes the current state as “alarming.”
The trauma of the collapse in international tourism isn’t just isolated to one home region. According to the U.S. Travel Association, visits from Western Europe, Asia, and South America have all decreased by double-digit percentages. A recent report from Tourism Economics shows a darker, more concerning trend. Air bookings for overseas summer travel to the U.S. are running about 10% less than last year’s pace right now.
The economic impacts of this alarming decline are clear and affected. Indeed, a report released Friday by Oxford Economics found that international visits to the U.S. were down 12% YOY in March. Freeman stressed that non-residents represent less than one-in-ten U.S. tourism demand. They are a widely popular, visually attractive, and much more lucrative segment of the market. Our overseas visitors spend an average overseas visitor their trip. That’s eight times the guest spend by the typical American tourist traveling domestically!
The broader economic repercussions of the drop-off in international tourism are huge. In 2024, international travelers added more than $180 billion to the U.S. economy. That value was more than the value of all agricultural exports put together. Adam Sacks, president of Tourism Economics, warned that this loss in international tourism could cost the U.S. economy around $10 billion this year compared to 2024.
Now, aside from the economics, travel advisories from almost every European country have started to come out. These advisories cite heightened border security and potential issues surrounding travel documents as reasons for caution when planning trips to the United States. Just earlier this April, China introduced a travel safety warning level for its tourists visiting the U.S. Among other things, they noted that worsening economic ties and domestic security issues have led to heightened distrust among tourists.
The drop-off of visitors isn’t limited to another continent far away. Our Canadian neighbors have seen a significant downturn in incoming visitors. Tourism Economics estimated that Canadian air arrivals were down 14% in March year-over-year. Land arrivals experienced an even sharper drop at 32%. The average Canadian and Mexican tourist spends an average of $1,200 per visit, injecting lifeblood into local economies.
Freeman has raised the alarm on the profit margin and top line revenue hit for the businesses that rely on our travel and tourism sector. He said it’s a concern that just 32% of the tourism sector were cash positive in April 2025. That’s down from 41% in April of 2024 and 43% in April of 2023, according to Gusto data.
“Whether fair or not, a perception is taking hold that more people are being detained, more devices [are] being searched and legal travelers [are] being deported back to their origin country,” – Geoff Freeman
Freeman shined a light on this misconception and how it produces a “great deal of fear,” which certainly affects travel choices for future tourists. When the fear of lost travel options or being able to travel safely kicks in, many people will start to change their minds.
Counter to these trends, there are those who feel cautiously optimistic about the future of the U.S. travel industry. Lorraine Sileo commented, “I don’t think it’s all doom and gloom for the U.S. travel industry,” suggesting that there may still be pathways to recovery as conditions evolve.
The response from travelers has been varied. Many of you have already started changing your travel plans following these latest announcements. A Reddit commenter shared their decision:
“Proud to say we’ve cancelled 3 US-based cruises over the next 2 years and instead will be vacationing in Europe and Canada.”
Now, more than ever before, travelers want to discover what’s in their own backyard. As a result, they are increasingly drawn to locales that they feel are safer.
As they enter this season with expectations for decreased sales due to a drop in international tourism, businesses are forced to navigate a new reality. The new and long-standing challenges make a case for a thoughtful response that balances the needs of travelers with the new economic realities.
“We’ll batten down the hatches and make the best of it.”
As businesses brace for falling sales amid declining international tourism, they are compelled to adapt to changing circumstances. The ongoing challenges underscore the need for a strategic response that addresses both traveler concerns and economic realities.
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