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U.S. Tourism Faces Major Decline in 2025 as Domestic and International Travel Falters

Economic uncertainty, tariffs, and political tensions are driving significant drops in travel spending and international arrivals, threatening the broader tourism economy.

Toronto residents Douglas Bloomfield, left, and his son Phoenix, right, who are on vacation in Washington, hold a Canadian flag and an ice hockey stick to show their support for Canada regarding trade tariffs as they pose with with another visitor to the city wearing a mask of President Donald Trump in front of the White House in Washington, Thursday, March 13, 2025. (AP Photo/Ben Curtis)
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Overview

  • Domestic travel spending has declined sharply, with air travel down 6% and lodging spending down 2.5% year-over-year as of March 2025, according to new data.
  • International arrivals to the U.S. are projected to fall by 9.4% in 2025, with Canadian travel expected to drop by 20%, significantly impacting border states and tourist destinations.
  • Major U.S. airlines have reduced forecasts for domestic air travel, citing weaker demand and lower consumer confidence amid economic uncertainty.
  • The Trump administration's tariffs and anti-foreigner rhetoric are deterring international visitors, with high-profile border detentions and strained diplomatic relations further exacerbating the decline.
  • Tourism Economics predicts foreign visitors will spend $9 billion less in the U.S. this year compared to 2024, reversing recent recovery trends and delaying a return to pre-pandemic levels until 2029.