From CNBC: 2025-05-10 09:00:00

Kaia Matheny and Nora Lamphiear, co-owners of Adrift Restaurant in Anacortes, Washington, are bracing for a decrease in foot traffic and financial impact this year due to trade tensions and immigration concerns affecting international travel to the U.S. Matheny noted a decline in sales, particularly from Canadian visitors.

Tourism experts reported a 12% drop in international visits to the U.S. in March, with significant decreases in visits from Canada, Western Europe, Asia, and South America. Data indicates a continuation of this trend through the summer, with bookings for overseas travel lagging behind last year’s numbers.

Factors contributing to the decline in international visitors include fears of a global trade war due to tariffs imposed by President Trump, as well as travel advisories issued by countries like China and European nations. Concerns about U.S. immigration policy and rhetoric have also impacted international travel decisions, with Canadian travel searches to the U.S. dropping by 50%.

The U.S. travel industry is facing significant challenges as international tourism is expected to decline, resulting in potential losses of billions of dollars to the economy. Domestic tourism is not expected to compensate for the drop in international visitors. Experts caution that 2025 will be a tough year for the travel sector as businesses adapt to changing travel patterns and preferences. Business profits for small and mid-sized companies have dropped significantly due to reduced customer traffic. Tourism company profits decreased to 32% in April 2025 from 41% and 43% in previous years. Accommodation business profits also fell to 36% from 44% and 45%. Financial losses are impacting businesses reliant on tourism.

The decline in profits is attributed to slower customer traffic, not increased expenses. The U.S. hasn’t reached pre-pandemic travel levels, with 72 million foreign visitors in 2024 compared to 78 million in 2019. Non-residents account for less than 10% of U.S. tourism but are high spenders, with the average overseas visitor spending over $4,000 per visit.

The drop in foreign travel will have a significant impact on areas like Las Vegas, Los Angeles, and Miami, which rely heavily on tourism. These economies are sensitive to changes in tourism and may struggle to absorb the loss. Businesses like the Adrift Restaurant have already seen a 4% decrease in sales, impacting the local economy in Anacortes.

Read more: Foreign tourist boycott begins, as businesses brace for impact