Domestic U.S. Tourism Growth Levels Off as Americans Head Overseas

25.08.2023 - 12:52 / skift.com / Anthony Capuano / Kelly Torrens / Dawit Habtemariam / Yves Marceau / Kensington Tours

U.S. tourism businesses surged after the pandemic. Now they’re giving back some of those gains as Americans have been traveling abroad. Skift spoke to several tourism companies and operators to assess domestic demand. It’s not a collapse, they say – but a clear softening.

“We feel like our bubble has burst and we’re getting back to normal, more like 2019 levels of visitation,” said Montana’s Discover Kalispell CEO Diane Medler, who pointed to international travel as one contributor.

Whidbey and Camano Islands has seen its short-term rentals bookings and lodging tax revenue drop due partly to international travel booming, said a spokesperson for Washington State’s Embrace Whidbey and Camano Islands.

“We’re seeing continued growth, but much slower growth than what we saw during the pandemic,” said Jon Gray, CEO of RVShare, an RV rental marketplace. Interest in longer outdoor domestic trip lengths is also weaker: Gray said seven day trips booked on RVShare have “seen more of a fall off” from last year.

Tour operators say there’s been a drop in domestic demand from U.S. clients. “What we’re hearing from our teams is that people are saying ‘I’m going to go international this year,’“ said Yves Marceau, vice president of product for G Adventures. “The U.S. to U.S. numbers are down,” he said. “We’ve seen it from hotels in Yellowstone, Jackson[,Wyoming], San Francisco and in a lot destinations in the U.S.”

Tour guide bookings at U.S. National Parks are down too. “Compared to the last two years, they were constantly fully booked. Now, there are spots of availability,” said Kelly Torrens, vice president of product for Kensington Tours.

Americans are traveling more than they did last year, that’s for sure. But the domestic U.S. businesses haven’t captured it. Between January and May, 36 million Americans traveled abroad, up 35% from the same period last year, according to the U.S. National Travel and Tourism Office. 

CEOs of large companies have sent a similar message on earnings calls. “Demand in the [U.S. and Canada] market has been stabilizing on a year-over-year basis with travelers from the region increasingly taking vacations overseas now that pandemic-related travel restrictions are behind us,” said Anthony Capuano, president and CEO of Marriott International, the largest hotel company in the world, after releasing quarterly earnings this month.

In early August, STR downgraded its growth forecast for the U.S. hotel industry due in part to more “travelers opting for overseas trips.”

Airlines are seeing international demand chip away at domestic travel. “We’ve seen a greater-than-expected geographic shift in pent-up Covid demand as the strength in demand for long international travel this summer has