Skift Take

Despite the substantial progress the U.S. has made, the country's tourism industry still has a ways to go to fully rebound from the pandemic. Here are the reasons why.

The U.S. travel industry has made tremendous progress in its recovery from the pandemic. Bookings for hotels, car rentals and tour activities have risen almost 30% from last year for travel between between Memorial Day and Labor Day — numbers that are expected to increase, according to travel organization AAA.

However, the industry is struggling to fully recover in other important ways. Why? Ask Skift, our artificial intelligence chatbot, provided answers to the question, using information appearing in our daily news coverage, Skift Research and Airline Weekly.

Here are the responses Ask Skift produced, as well as what else you need to know.

Decrease in Chinese Tourists

Ask Skift said:

The U.S. tourism industry heavily relies on the influx of Chinese visitors. Prior to the pandemic, China was the U.S.’s fourth top market, having sent over 2.3 million tourists in 2019. Although China fully reopened its borders earlier this year after more than two years of restrictions, U.S. destinations have not seen Chinese tourists return in serious numbers. In fact, from May 2022 through April 2023, the U.S. welcomed over 540,000 Chinese travelers, which was an 81% drop from the same month in 2019. This significant decrease in Chinese tourists has hindered the U.S.’s tourism recovery.

What else you need to know:

Brand USA CEO and President Chris Thompson said at a U.S. Senate hearing this June that unless the country sees a large-scale return of Chinese tourists, it won’t fully recover from the pandemic. U.S. destination marketing organizations have unveiled plans to increase marketing in China later this year as part of their strategy to boost visitor numbers from the country.

However, Global Tourism Reporter Dawit Habtemariam wrote the success of those efforts depend on the U.S. and China restoring flight schedules between the two countries to pre-pandemic levels. Twenty-four flights currently operate weekly between the U.S. and China — down from about 350 per week prior to the pandemic.

The flight limits have remained in place largely due to strained U.S.-China relations. Edward Russell, editor of Skift publication Airline Weekly, reported in June a sticking point between U.S. and China was Chinese airlines’ use of Russian airspace for U.S. flights. American carriers are prohibited from flying over Russia due to the country’s invasion of Ukraine.

Another issue is that visa applications by Chinese citizens are still well below pre-pandemic levels even after Beijing announced late last year it was lifting travel restrictions. Specialist visa firm VFS Global revealed visa application volumes from China this year had only hit 35% of pre-Covid levels by May compared to the same period in 2019.

In addition, more than half of Chinese travelers said they haven’t made plans to go abroad this year, according to a survey conducted by marketing solutions firm Dragon Trail International in April. Skift Research’s newly released State of Travel 2023 report revealed that 30% of Chinese consumers expect to cut spending on travel due to higher prices.

Struggles With Overseas Markets and Business Travel

Ask Skift said:

Moreover, the U.S. Travel Association President and CEO, Roger Dow, stated that “a full travel recovery will depend on reopening international markets” and reviving business travel. The association reported that international travel to the U.S. dropped by 81% in 2020, including significant plunges from Mexico and Canada. So, the U.S. needs to attract more international tourists for a full recovery.

What else you need to know:

Global Tourism Reporter Dawit Habtemariam wrote in November 2022 that overseas visitor numbers weren’t expected to reach pre-pandemic levels until 2025. The U.S. welcomed 51 million international visitors in 2022, roughly 64% of its 2019 mark. In addition, the U.S. Travel Association projected that international inbound travel to the U.S. would reach 75% of its pre-Covid volume in 2023.

While international inbound travelers spent nearly $16.8 billion on travel to and tourism-related activities in the U.S. in March 2023, a 49% percent year-over-year increase, the country experienced a $572 million travel trade deficit. The U.S. has had at least 10 monthly travel trade deficits since July 2021, according to the National Travel and Tourism Office. It had never recorded one prior to that month.

As for business travel, a Deloitte analysis released this April revealed the sector’s full recovery might not happen until late 2024 or 2025. United Airlines CEO Scott Kirby acknowledged in June that the U.S. was experiencing a “business recession,” even as leisure travel was making significant progress in its recovery.

Changes in Marketing Platforms

Ask Skift said:

Changes in the availability and use of certain marketing platforms can also affect the recovery. For example, if a popular platform like TikTok were to be banned nationally, it could result in tourism boards redirecting their advertising dollars to other platforms like Instagram and YouTube Shorts. This could potentially disrupt the effectiveness of marketing efforts aimed at attracting international travelers.

What else you need to know:

Global Tourism Reporter Dawit Habtemariam wrote in April that there was a push to ban TikTok across the U.S. due to concerns about its connection to the Chinese government and potential risk to U.S. national security. More than half of U.S. state governments have already banned their agencies from using the platform. In addition, the state tourism agencies of South Carolina, Utah and Georgia, among others, have either deleted or made their TikTok accounts inactive.

Habtemariam added that under a ban, U.S. destinations would no longer be able to participate in a global conversation on the enormously popular social media platform.

Mackenzie Bromley, vice president of social media and content strategy for travel marketing agency MMGY Global, said a national ban would result in destinations having less insight into international travelers’ experiences. Forty-five percent of millennial TikTok users have visited a location after seeing it on the platform and 60% of all users said they first became interested in a destination because of videos on the app, according to a survey of U.S. TikTok users released in April by public relations firm MGH.

UPDATE: Roger Dow, the longtime CEO of the U.S. Travel Association, retired in July 2022 and was succeeded by Geoff Freeman.

More Responses From Ask Skift:
Why Is Summer Travel so Difficult?
What Is AI’s Impact on Travel?
Ask Skift: What Is the Biggest Emerging Outbound Tourism Market?


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Tags: ask skift, recovery, tourism recovery, u.s. tourism

Photo credit: A not-too-crowded part of Broadway in New York City. The city's tourism industry still hasn't made a complete recovery from the pandemic yet. Jimmy Teoh / Pexels

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