🌅 Tourism Is Plummeting and Taking GDP with It

SOURCE

International Trade Association

WHAT TO KNOW

• The number of international travelers visiting the U.S. fell by nearly 12% last month from the same time last year. The March downturn followed a 2% year-over-year decline in February, which marked the first significant decline in U.S. tourism since the early days of the COVID pandemic. Car trips by Canadians have also plummeted, falling 32% in March after dropping 23% the month prior.

WHY IT MATTERS

• The U.S. travel industry generated $1.3 trillion in 2024 and accounted for around 15 million American jobs. Beyond hotel rooms and recreational activities, an analysis by J.P. Morgan found the decline in tourism is also impacting oil, with U.S. gasoline demand falling by around 3% over the past three weeks. Overall, analysts at Goldman Sachs estimate the drop in tourism could reduce U.S. GDP by up to 0.3% this year, or around $90 billion.

CONNECT THE DOTS

• Data shows President Trump’s border policies have contributed to a growing wave of negative sentiment among foreign travelers considering a trip to the U.S. The decline in travel could prove disastrous for many small- and mid-sized cities, which research shows often rely on tourism as a primary driver of economic activity.