Why Trump's return to power might cost millions of dollars to America

Time of India

28-05-2025

The United States is facing a decline in international visitors. This is due to trade tensions and stricter visa policies. Travel to the US fell by 14% in March. Canadian travel dropped significantly after tariffs. Experts cite tougher policies and a strong dollar. The decline threatens the tourism sector. It could lead to job losses in hospitality.
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International tourism declines in US
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What would be the economic impact?
Amid a global trade war, visa cancellations, and tourists being detained at the border, the United States has sent a decidedly unwelcoming message to potential visitors. The likes of New York, Los Angeles or Nashville are bucket-list destinations for millions of holiday-makers.But since Donald Trump returned to office, some travellers are steering clear of the US, with the loss predicted to cost billions. Multiple media outlets have reported extraordinary decline in international visitors, especially from Europe, during the new Trump administration.International travel to the United States fell 14% in March compared with the same period last year, according to the US Travel Association , reports CBS News. And unsurprisingly, the biggest dip in travel, 20.2%, was from Canada, according to research from Tourism Economics, a unit of investment advisory firm Oxford Economics.According to the International Bridge Administration in Sault Ste. Marie, passenger car traffic in April dropped by 44% compared to the same month last year. While this decline may seem insignificant from the perspective of Canada's second-largest province and top tourist destination, it has a notable impact on the historic Michigan town.According to the International Bridge Administration in Sault Ste. Marie, passenger car traffic in April dropped by 44% compared to the same month last year. While this decline may seem insignificant from the perspective of Canada's second-largest province and top tourist destination, it has a notable impact on the historic Michigan town."They have 70,000 people," Hoath said. "And if they're not coming over and buying in our stores, then it affects us much more."Earlier this year, former Prime Minister Trudeau urged Canadians to refrain from vacationing in the US, after Trump imposed a 25% tariff on Canadian goods. The drop-off in Canadian travel is a notable shift, given that Canada was the biggest source of inbound travel to the US last year, according to the World Travel & Tourism Council.Experts attribute the overall decline in international travel to the U.S. to several factors, including the Trump administration's tougher immigration policies, a strong US dollar, and lengthy visa processing times. Additionally, aggressive tariff measures have discouraged many potential visitors."Shifting sentiment and perceptions of the US are expected to continue to weigh heavily on travel demand," said Aran Ryan, director of industry studies at Tourism Economics.As of April, flight bookings to the US for the May–July travel window are 10.8% lower than they were the same period last year, according to the research firm. It projects an 8.7% decline in international arrivals in 2025.The decline in international travel poses a serious threat to the stability of America's tourism sector — a critical component of the national economy."International inbound travel is hugely important from an economic standpoint — people that come to the US and visit spend on average $4,000 per visit," a spokesperson for the US Travel Association told CBS MoneyWatch.But those tourism dollars may already be slipping away. The World Travel & Tourism Council estimates international visitor spending in the U.S. will fall to $169 billion this year — a 7% drop from $181 billion in 2024. That's also a steep 22.5% decline compared to the $217 billion spent in 2019, before the pandemic.A drop in global visitors could also have major consequences for American workers. Nearly 10% of U.S. jobs are linked to the travel industry, according to the council.If the downward trend continues, the U.S. could lose more than 230,000 jobs, with the hospitality and restaurant sectors expected to be hit hardest, according to recent analysis by economic research firm IMPLAN."It's not going to devastate the U.S. economy in terms of GDP, but it is very significant in terms of employment," said Jenny Thorvaldson, IMPLAN's chief economist and data officer, in an interview with CBS MoneyWatch.Those impacts are already being felt in local communities. For example, in Sault Ste. Marie, Michigan, visitor center manager Linda Hoath voiced concern about what a slower travel season could mean."When the bridge is busy, businesses need all hands on deck," she explained. "But when it's quiet, what happens to your workers? They're not making money. Some will be laid off."In fact, hotel bookings in the city of 14,000 are already down 77% year to date, according to the Sault Area Convention & Visitors Bureau.