Major Drop in U.S. Tourism Revenue Linked to Canadian Travel Decline
The United States is facing a significant shortfall in tourism revenue this year, with a projected decline of $5.7 billion attributed largely to a steep drop in visitors from its northern neighbour. According to the U.S. Travel Association, total spending by international tourists is expected to reach only 80% of pre-pandemic levels in 2025.
The association's latest forecast, released in November 2025, pinpoints a substantial decrease in trips from Canada as the main reason for this downturn. “Significantly fewer visits from Canada are the primary driver of this decrease,” the report states, adding that travel volume from other countries remains flat.
By the Numbers: A Sharp Decline in Cross-Border Travel
The data reveals a dramatic year-over-year change. After seeing 20.2 million Canadian visitors in 2024, the U.S. is projected to welcome only 15.7 million in 2025. This represents a sudden drop of 4.5 million people crossing the border.
This decline is so pronounced that the association's long-range forecast does not anticipate Canadian visitor numbers to surpass the 20-million mark again until 2029. The contrast is further highlighted by travel from Mexico, which is expected to increase to 17.9 million visitors this year, and overseas visits, which are projected to see only a slight dip.
Broader Trends and Future Outlook for U.S. Travel
Despite the challenging international inbound numbers, the report includes some positive notes. Overall travel spending—which includes business, leisure, and domestic travel—is predicted to see modest growth over the next five years, though a full recovery to pre-2020 levels will take several years.
The forecast also indicates that international inbound travel is expected to decrease in 2025 for the first time since the pandemic year of 2020. However, growth is projected to resume in 2026, boosted by major U.S.-hosted events like the FIFA World Cup and the America 250 celebrations.
The U.S. Travel Association remains cautious, citing potential risks such as consumer uncertainty, deteriorating economic conditions, and policy-related hurdles. These include potential increases in visa fees, extended application wait times, and negative sentiment towards the U.S. in key international markets.
The issue of cross-border relations was brought into public view during a visit by Prime Minister Mark Carney to the U.S. last month, where a reporter directly asked U.S. President Donald Trump about factors, including political rhetoric and trade tensions, that might be deterring Canadians from travelling south.
