The Impact of COVID-19 on the U.S. Tourism Industry : A Look at the Past, Present, and Future (2024)

Not very surprisingly, but the COVID-19 pandemic left the worst impact on the U.S. tourism industry. The pandemic outbreak started and ended with extreme travel restrictions domestically as well as internationally. This, as a result, massively affected tourist arrival and showed a massive decline in the growth of the U.S. tourism industry.

With few industries being spared by the hit of the COVID-19 pandemic, U.S. tourism was never one of those. As soon as much of the world imposed travel restrictions in March 2020, especially National and International travel, it brought the tourism industry to a halt. Earlier in 2019, the U.S. Travel & Tourism sector received nearly $1.9 trillion of GDP. Travel and Tourism have always played a huge role in a country’s GDP, given the U.S. boasts the largest Travel & Tourism economy in the world. However, as soon as 2020 got hit by the pandemic, the U.S. tourism industry saw a decline of 41% decreased GDP contribution.

Not only that, but in 2019, before the pandemic started spreading its roots, 10.5% of total U.S. employment (nearly 16.5 million jobs) came through Travel and Tourism. However, the COVID-19 outbreak and global restrictions declined the employment rate by 33.2% leaving only 11.1 million supported by the tourism sector. Not only in the United States but also during the pandemic outbreak, 18.5% of jobs were impacted in the Travel and Tourism sector worldwide.

The travel shock kept on being imposed even in 2021 despite restrictions being loose by then. Industries that have been impacted due to the decline in tourism include airlines, cruise (and other transportation), hotels, food, the rental car industry, casinos, and tourist attractions. The pandemic hit hard and resulted in millions of dollars in revenue loss and several millions of job losses. For instance, Disney, in the third quarter of 2020, reported a loss of more than $2.9 million.

Impact of COVID-19 Pandemic on the U.S. Tourism Industry in 2021

As the COVID-19 pandemic continued its global impact in 2021, the U.S. Travel and Tourism industry didn’t get the time to recover from the loss. Tourism in Hawaii went down by almost 100% during April 2020, whereas the entire year, Florida experienced a drop of 11%.

In July 2021, the United Nations Conference on Trade and Development in its report stated that as a result of the COVID-19 pandemic, the global economy might suffer a loss of US$4 trillion.

COVID-19 Pandemic and U.S Tourism Industry in 2022- 2023

U.S. Travel and Tourism saw a standstill in the years 2020 and 2021 due to the global COVID-19 pandemic challenges. However, the year 2022 became an important year regarding compensating for the damage. 2022 didn’t receive an increase in U.S. tourism like 2019 and before, but it definitely saw some development. The recovery was stronger than expected.

Similarly, according to some reports by the United Nations World Tourism Organization, 2023 may see 80% to 95% of pre-pandemic level development in the tourism industry.

United Nations World Tourism Organization released new data stating that over 900 million tourists traveled internationally in 2022. Not only the U.S. but every global region experienced a notable increase. The ongoing recovery has started seeing development in the Middle East, Europe, and India, respectively. The Middle East experienced the highest number of increases in tourism, about 83% of pre-pandemic numbers. In contrast, Europe saw 80% of pre-pandemic levels in its travel and tourism sector. Asia Pacific experienced 23% of pre-pandemic numbers. This was a result of stronger pandemic-related restrictions in Asian countries. American and African countries, on the other hand, received 65% of their pre-pandemic numbers.

However, with the evolution of the Russia and Ukraine war, which is perhaps the second black swan after the COVID-19 pandemic, the world economy is still struggling.

Travel Trends and Predictions in 2023 and Further

2023 has started seeing normalcy returning in the travel and tourism industry. Due to the increased pricing in different sectors, travel presently can be overwhelming, but people are inclined towards stepping out and around.

2023 has also bought inflation hitting hard, but that hasn’t really affected people’s travel plans. U.S. Travel Foundation has forecasted a boast in tourism in 2023 with even better results in 2024. Since the demands are set to increase, travelers can expect to see full flights and competition in deals.

U.S. residents are all set to head to lower-cost countries, given U.S. dollar is experiencing its highest in a long time. It’s nearly everywhere outside of their country; tourism started to seem very affordable. This, as a result, can increase the tourism crowd in countries that are relatively new on travel lists.

In addition, the U.S. will still continue to receive domestic traffic. A good percentage of travelers are planning to travel within the United States instead of making it an international trip. Currently, the most searched tourist destinations by U.S. citizens and travelers globally are summer destinations in the west.

All in all, for the most part, tourism and travel in the U.S. is bouncing back to the pre-pandemic levels. Despite the Russia-Ukraine war and the recent inflation, the tourism sector is estimated to grow unaffectedly. This will result in the economic impact to see positive growth as well.