Tuesday, May 13, 2025
The United States is poised to experience one of the most severe tourism declines in recent history, with fresh data from the World Travel & Tourism Council (WTTC) projecting a $12.5 billion loss in travel revenue for 2025. This stark forecast places the US in a uniquely troubling position among 184 global economies analyzed, with the WTTC citing both long-standing policy issues and recent economic shifts as major contributors to the downturn.
According to the report, visitor spending is expected to dip below $169 billion by the end of 2025, representing a 7% year-on-year drop and a significant 22% shortfall compared to the industry’s peak in 2019.
US Alone in Global Decline While Others Recover
Out of all economies surveyed in collaboration with Oxford Economics, the United States is the only country forecasted to lose tourism revenue this year. This stark contrast stands in sharp relief to other countries, many of which are implementing digitized visa programs, streamlined entry policies, and travel incentives to welcome back global visitors.
“While other countries are rolling out the welcome mat, it feels like the US is hanging a ‘closed’ sign,” remarked Julia Simpson, WTTC President and CEO. She warned that the consequences of this shift could be far-reaching, particularly given the sheer scale of the American tourism economy.
Economic Weight of the US Travel Sector
Tourism accounts for nearly $2.6 trillion in value, or about 9% of the US GDP, encompassing both direct spending (by tourists) and indirect economic impacts (such as supply chain contributions and employment in the hospitality sector). The sector employs around 20 million people and generates approximately $585 billion in tax revenue, which is about 7% of all federal tax receipts, according to WTTC estimates.
Simpson described the industry as a “mainstay of the American economy”, noting that this downturn could have a cascading effect across various states and industries.
Lingering Policy Challenges and Shifting Sentiment
Industry experts pointed out that the problems now facing US tourism are the result of policy inertia stretching back years, particularly during and after the COVID-19 pandemic. The United States maintained stricter travel restrictions longer than many other countries, creating delays in recovery. Meanwhile, the strong US dollar has made travel to the US expensive, pushing away potential visitors from Europe and Asia.
Simpson highlighted that while currency strength matters, there’s also a deepening perception problem. The current US administration’s “America First” rhetoric is believed to have contributed to a broader sentiment shift among international travelers.
Recent data from the US Department of Commerce supports these claims, showing sharp declines in key inbound markets:
- UK arrivals down by 15%
- German tourists dropped by 28%
- South Korean visits fell by 15%
- Visitors from Spain, Ireland, and the Dominican Republic declined between 24% and 33%
This sentiment shift, according to Simpson, represents more than economics—it reflects a growing feeling that the US is no longer as welcoming to global travelers as it once was.
New York and Border States Hit Hard
The financial hit is not evenly distributed. Major tourism hubs and gateway cities, including New York, are expected to bear the brunt of the decline. On May 8, New York City’s tourism office revised its 2025 outlook sharply downward, forecasting 400,000 fewer visitors and a $4 billion drop in tourism revenue compared to 2024.
While domestic tourism is expected to grow slightly, with 400,000 more Americans visiting the city, international tourism—typically more lucrative—is forecasted to fall by 800,000 visitors. In 2024, international tourists contributed 50% of NYC’s $51 billion tourism economy, underscoring the disproportionate impact of this decline.
Governor Kathy Hochul also confirmed that regions bordering Canada, especially New York’s “north country,” were suffering. 66% of businesses in those areas reported steep declines in Canadian bookings, and 26% had already reduced staff in response. Hochul linked the drop in sentiment to controversial rhetoric around cross-border relations and tariffs.
Legislative Risks May Deepen the Damage
Adding to the industry’s concerns are proposed legislative changes to the Electronic System for Travel Authorization (ESTA). This pre-screening requirement for travelers from visa-waiver countries currently costs $21 per person. New legislation could raise it to $40, a move Simpson warns could deter even more travelers.
“The tourism sector is incredibly resilient,” Simpson said. “But hiking ESTA fees when sentiment is already declining will only make the US less competitive.”
Domestic Tourism Can’t Carry the Burden Alone
One of the more sobering points made by WTTC was that 90% of the current US tourism economy is fueled by domestic travel—Americans traveling within the country. This makes international tourism an essential growth area, not a luxury. But with travel sentiment falling and other nations offering easier, cheaper, and more welcoming travel experiences, the US is losing global market share fast.
Countries such as India, China, and those in the Middle East and Europe were highlighted as examples of travel markets surging forward thanks to aggressive tourism incentives, new digital visa schemes, and international outreach efforts.
Long Road Ahead for US Tourism Recovery
WTTC now forecasts that US tourism will not fully recover to pre-COVID-19 levels until at least 2030—a timeline that could stretch further if legislative and economic challenges aren’t addressed soon. As every year passes with missed opportunities and declining arrivals, recovery becomes harder to achieve.
Simpson stressed that travel and tourism can bounce back rapidly if the right policy changes are made. These include:
- Rebuilding international trust and sentiment
- Reducing entry barriers such as visa and ESTA costs
- Promoting the US as a welcoming destination
- Streamlining entry procedures through digital solutions
Without these efforts, the United States risks falling behind globally as other countries take the lead in the race to attract high-value international tourists.
Tags: Canada, Canadian Tourism News, Dominican Republic, Empire State tourism news, germany, ireland, New York, New York Tourism News, south korea, spain, U.S. Department of Commerce, United Kingdom, United States, World Travel and Tourism Council, WTTC
