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This puts the U.S. in a league of its own. Out of 184 global economies analyzed by WTTC in conjunction with Oxford Economics, it鈥檚 the only one projected to lose tourism dollars this year.聽鈥淥ther countries are really rolling out the welcome mat, and it feels like the U.S. is putting up a 鈥榳e are closed鈥� sign at their doorway,鈥� says WTTC president and CEO Julia Simpson.

The consequences, Simpson says, could be devastating. 鈥淭he U.S. travel and tourism sector is the biggest sector globally compared to any other country, worth almost $2.6 trillion,鈥� she says, citing聽WTTC and Oxford Economics data.聽According to Simpson鈥檚 data, direct and indirect tourism represents nine per cent of the American economy. (Visitor spending is one of the 鈥渄irect鈥� parts of the travel economy, while 鈥渋ndirect鈥� contributions include the knock-on effects of increased spending by hospitality professionals.)

The sector employs聽20 million people and creates $585 billion in U.S. tax dollars each year 鈥� seven per cent of all tax revenue the U.S. government receives. It鈥檚 a 鈥渕ajor mainstay of the U.S. economy,鈥� she says.

The聽issues the industry faces聽have been years in the making. The problems began in the Biden era聽as a result of COVID-era travel requirements that lingered longer than they did in most other nations. Then the soaring dollar started pricing people out. 鈥淭he Japanese used to visit the U.S. a lot, but the strong dollar made it quite an expensive place,鈥� Simpson says. 鈥淪ame with Europeans.鈥�

But now, she says, a shift in people鈥檚 views is turning cracks in the American travel economy into chasms. According to international arrivals data from the U.S. Department of Commerce, travellers are already shifting their behaviour as a result of the Trump administration鈥檚 鈥淎merica First鈥� rhetoric and policy.

鈥淲hat we are seeing now is a sentiment shift that鈥檚 really very sad,鈥� Simpson says. 鈥淟egislators need not confuse the tourism sector with issues around illegal immigration. A聽sophisticated system can balance both without turning (the country) into an island that no one wants to visit.鈥�

In March 2025,聽the most recent month for which data is available, arrivals were significantly down for all of the U.S.鈥檚 most robust visitor populations. U.K. arrivals were down 15 per cent year-over-year; Germans were down 28 per cent; South Korean trips declined by 15 per cent; and other key source markets, including聽Spain,聽Ireland and the Dominican Republic, were down between 24 per cent and 33 per cent.

The effects won鈥檛 be felt evenly across the U.S., with the $12.5-billion deficit disproportionately affecting major U.S. gateways as well as tourism areas along the Canadian border.

Take New York City and the broader Empire State as an example. On May 8, the city鈥檚 tourism agency reversed course on its positive outlook for 2025 鈥� the year it expected to finally rebound fully from the impact聽of the pandemic 鈥� to forecast that it would receive 400,000 fewer tourists and $4 billion less in tourism spending than it did in 2024.

The latest projections for New York, accounting聽for a total of 64 million tourists this year, include estimates that 400,000 more domestic tourists 鈥� but 800,000 fewer international visitors 鈥� will visit the five boroughs. Tourists from abroad聽tend to stay longer and spend more, and in 2024聽they represented half of the $51 billion that the city netted via tourism.

According to Governor Kathy Hochul, this slump extends to regions upstate. Some 66 per cent of businesses in New York鈥檚 鈥渘orth country,鈥� which juts out toward聽Ottawa and Montreal, have already felt a 鈥渟ignificant decrease鈥� in Canadian bookings for 2025. In an April 29 press release, Hochul attributed that figure to President Donald Trump鈥檚 鈥�51st state鈥� rhetoric and the impact of tariffs. Among those north country businesses,聽26 per cent have already adjusted staffing in response to the declines.

The damage is profound. WTTC now forecasts that it will take until at least 2030 for U.S. tourism to recover to pre-COVID levels. And that鈥檚 if things don鈥檛 get worse before they get better.聽People in the industry, she says, have taken note of proposed legislation that would raise the cost of the Electronic System for Travel Authorization (ESTA), which is required of all travellers who plan to come to the U.S. from countries that participate in the Visa Waiver Program. It is currently $21 per traveller but could rise to $40 if the legislation is adopted.聽

鈥淭he thing about tourism is it鈥檚 extremely resilient,鈥� she says.聽鈥淚f you push the right buttons, it will bounce back. But increasing the cost of an ESTA will only deter people further.鈥�

It鈥檚 a cost for which the U.S. can鈥檛 easily compensate. Already, 90 per cent of the U.S. tourism economy is made up of domestic travel 鈥� Americans vacationing within the 50 states 鈥� making it a hard sector to grow. Meanwhile, Simpson adds, every other country is making it easier for people to come visit with new perks like digitized visas. 鈥淚ndia is gaining, the Middle East is gaining, China is gaining, Europe is doing quite well,鈥� Simpson says. 鈥淚t鈥檚 only Americans that are being left behind and losing out.鈥�

Bloomberg