In the heart of America’s bustling tourism sector, a troubling trend has emerged this year, with international visitors increasingly opting for destinations outside the United States. Business owners and industry experts are voicing frustration over what they describe as a “self-inflicted injury” to the nation’s appeal, driven by a mix of policy decisions, geopolitical tensions, and rising costs that have deterred global travelers.

From New York City’s iconic landmarks to California’s coastal retreats, the drop in foreign footfall is palpable. Hotel occupancy rates in major hubs have dipped, and local economies reliant on tourism dollars are feeling the strain. One Manhattan-based tour operator, speaking anonymously, lamented the loss of group bookings from Europe and Asia, attributing it to perceptions of unwelcoming policies.

Policy Headwinds and Visitor Hesitation

Recent data underscores the severity: international arrivals fell by 6.2% in June alone, with sharp declines from Canada and Scandinavia, according to reports from TravelMole. This isn’t isolated; the World Travel & Tourism Council projected a staggering $12.5 billion loss in international traveler spending for 2025, positioning the U.S. as the sole major economy experiencing such a downturn amid a global tourism boom.

Compounding the issue are visa complications and border policies that have sown confusion. Industry insiders point to heightened scrutiny at entry points, which has led to longer wait times and detentions, deterring potential visitors. A report from The New York Times highlighted how these factors could cost the economy up to $29 billion if trends persist, echoing sentiments from affected stakeholders.

Economic Ripples Across States

The fallout is particularly acute in states like New York, Florida, and California, where tourism supports thousands of jobs. In Las Vegas, visitor numbers have plummeted by 12%, impacting hotel revenues and forcing resorts to slash rates, as detailed in analyses from Travel And Tour World. Business owners in these areas express anger, with one Florida entrepreneur telling CNN they are “super-duper angry” about the avoidable decline.

Even domestic surges in places like San Francisco can’t fully offset the international shortfall, especially from key markets like Canada, where travel has dropped for six consecutive months. States bordering Canada, including Michigan and Washington, report declines of 30% or more, per insights from AOL.

Geopolitical and Cost Factors at Play

Geopolitical tensions, including trade disputes and immigration rhetoric, have further eroded the U.S.’s image abroad. A Forbes analysis links these to policies under the current administration, estimating losses up to $29 billion. Rising visa fees and travel costs exacerbate the problem, making alternatives like Europe more attractive.

Experts from NC State University warn that prolonged declines could lead to widespread job cuts in hospitality, with long-term effects on local economies.

Path Forward for Recovery

To reverse the tide, industry leaders advocate for streamlined visa processes and targeted marketing campaigns to rebuild trust. The U.S. Travel Association has called for policy reforms, emphasizing that competitors like Canada and the EU are capitalizing on America’s missteps.

Yet, optimism lingers among some analysts. A New York Times interactive piece suggests that while ominous signs abound, core travel data shows resilience in certain segments, such as from Central and South America. For now, the sector watches closely, hoping for a rebound before deeper scars form.