U.S. Travel Growth Is Slowing Due to International and Business Weakness

After an unusually robust September, domestic business travel in the U.S. has returned to its more familiar position: a slump.

According to the latest Travel Trends Index from the U.S. Travel Association and Oxford Economics, domestic business travel demand dropped in October year over year. That downward trend is expected to continue in the next few months before starting to edge into slow-growth territory.

International inbound travel grew in October, but only slightly. The report said the number of visitors from other countries is expected to drop over the next several months as the strong dollar keeps the United States an expensive proposition for many foreign travelers.

“Given the expected stagnation in both international inbound and domestic business travel, continued growth in domestic leisure travel will remain the key to fueling the U.S. travel industry in the months ahead,” David Huether, U.S. Travel Association senior vice president for research, said in a statement. “The relative strength of domestic leisure travel will likely be further highlighted as holiday travel numbers are reflected in the coming months’ readings.”

Driven by domestic leisure travelers, U.S. travel volume overall is expected to grow at a rate of about 1.4 percent through April of 2017.

The report, released Tuesday, says “a restrained outlook for business investment” still weighs on the outlook for business travel within the country. Domestic business travel had grown faster than leisure travel in September, but that was likely just due to the impact of Rosh Hashanah and Yom Kippur falling in October this year.

“Expect a conservative path ahead for businesses leading into the new year, as there is no shortage of uncertainty regarding the President-elect’s policy strategy,” Adam Sacks, president of the tourism economics group at Oxford Economics, said in the report.