As the US summer vacation season begins, businesses that rely on international travellers are feeling the pinch. Hotels, restaurants, and tourist attractions from Times Square to California are reporting fewer foreign visitors than usual. Analysts and business owners are linking this sharp decline to tougher US immigration policies, heightened visa restrictions, and rising political tensions, particularly under the Trump administration.

According to US Customs and Border Protection, only about 1.9 million international passengers arrived at US airports over the last four weeks—a 6% decline from the same period last year. The numbers suggest the downturn isn’t temporary. Forward bookings into August are also down, especially from key tourism regions like Canada and Europe.

Canada's Absence: A Major Shift for US Tourism

Canada, which has historically been the largest international source of US tourists, is showing the sharpest decline in visitor numbers. Flights from Canada to the US in April dropped by 20%, while land border crossings fell 35%, according to the Canadian government. Summer travel bookings are down 22%, especially to major American vacation destinations such as Miami and Los Angeles.

In towns like Plattsburgh, New York, which heavily depend on Canadian tourism—up to 70% of summer visitors—businesses are already experiencing the impact. John Parmelee, manager of the Naked Turtle restaurant, said they are trying to entice Canadians with welcoming signs and possible discounts.

One Canadian truck driver, Marc Toews, cancelled a planned US road trip, citing President Trump’s controversial comments about annexing Canada. “There’s not a lot politically I can do, but what I can do is not spend my money in the US,” he said.

European Travellers Look Elsewhere

European tourists are also turning away from the US. Concerns around visa processing, political friction, and border scrutiny are making potential travellers look elsewhere. For instance, David Byrne, a retired executive from London, scrapped a $7,000 trip to New York and chose to holiday in Santorini, Greece, instead.

Another tourist, Achim Diergarten from Germany, cancelled a planned road trip across the American West after hearing about Europeans being detained at US borders or having their phones searched. He opted for Vancouver, Canada, as a safer and friendlier alternative.

Hotels are feeling the effects. The Garland Hotel in North Hollywood has seen a 30% drop in international visitors. According to general manager Scott Mills, visa issues and political concerns are compounded by misconceptions about safety, especially following events like California’s January wildfires. “Some tourists think the entire city burned down,” he explained.

Wider Economic Impact on Local Businesses

Although international tourism contributes about 3% to the US GDP, its local impact is far more significant. Small and medium-sized businesses, which form the backbone of US hospitality, are already struggling to cope with the drop in revenue.

According to Tourism Economics, earlier projections estimated a 16% rise in foreign visitor spending for 2025. However, with current trends, there’s now an expected $8.5 billion decline, roughly 5% less than previous estimates.

Business owners like Omar Tallat, who runs a corn dog stand near Times Square, say the difference is already visible. “There used to be thousands of Canadians here,” he said. “Now, it’s just not the same.”

Local Efforts to Revive Tourism

Some US towns are making efforts to win back Canadian and European tourists. Palm Springs recently displayed banners saying "Palm Springs loves Canada", while regional tourism boards in New York, Maine, and other areas are offering special discounts for Canadian travellers.

However, local authorities acknowledge that public sentiment and national policy will need to shift to fully reverse the trend. Until then, businesses will continue to suffer, especially those that depend heavily on high-spending international guests.

Domestic Travel Not Enough to Fill the Gap

Adding to the problem, domestic travellers—who might have filled the void left by international tourists—are also cutting back on travel due to economic concerns. Meanwhile, foreign tourists typically spend more per visit, creating a gap that’s difficult to fill.

The decline in foreign tourism leaves behind empty hotel rooms, slower restaurant turnover, and less revenue for small businesses. It also threatens jobs and undermines future investment in tourism infrastructure.

The Bigger Picture: What Lies Ahead

The current situation represents more than just a temporary slowdown. The drop in visitor numbers reflects a larger shift in global sentiment about travelling to the US. From visa policies and political rhetoric to perceptions about safety, the US faces a complex challenge in rebuilding its image as a welcoming destination.

As long as travellers continue to feel unwelcome, unsafe, or restricted, they will choose alternatives—and the impact on US tourism, employment, and small businesses will likely deepen.

Conclusion

The downturn in US tourism this summer is a direct result of a mix of policy decisions, global perception, and logistical barriers. Fewer foreign travellers—especially from Canada and Europe—have resulted in an alarming drop in bookings, hurting local economies and creating uncertainty for the future. While discounts and local campaigns are short-term solutions, the need for more welcoming visa policies and positive diplomacy is urgent if the US hopes to regain its position as a top international destination.

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