USTA: Travel Spending in U.S. to Plunge 45% This Year

WASHINGTON—Total travel spending in the U.S. is predicted to drop 45% by the end of this year, spurring renewed calls from the U.S. Travel Association (USTA) for federal measures to support the industry that was one of the top U.S. employers and exporters prior to the pandemic.

According to a forecast prepared for USTA by Tourism Economics, domestic travel spending is forecast to drop 40% (from $972 billion in 2019 to $583 billion in 2020) while international inbound spending is expected to free-fall a whopping 75% ($155 billion to $39 billion).

Total domestic trips taken by U.S. residents are expected to fall 30% from last year to 1.6 billion—the lowest figure since 1991, another recession year.

The grim forecast numbers arrive as U.S. Travel commences its first-ever “Virtual Hill Week,” connecting members of the industry with lawmakers to discuss travel priorities and needs. Nearly 300 industry members will participate in 75 online meetings with lawmakers in both the House and Senate.

“The data is telling us that travel and tourism has been more severely damaged than any other U.S. industry by the economic fallout of the health crisis,” said Tori Emerson Barnes, EVP for public affairs and policy, USTA. “Given that travel employed one in 10 Americans and was the No. 2 U.S. export before the pandemic, supporting this industry through to the recovery phase ought to be a national priority. Our asks for lawmakers are substantial, but they’re also simple: We need relief, protection and stimulus for the travel industry to make it past the worst of the crisis and help power an economic recovery.”

Among the policy priorities members of the travel industry will discuss in Congress this week:

  • Extending Paycheck Protection Program eligibility to destination marketing organizations (DMOs). Though they are crucial engines of local and regional economic development, most DMOs are currently ineligible for aid because they carry a nonprofit or quasi-governmental designation.
  • Tax incentives for a strong and safe restart of the travel economy, including a temporary travel tax credit; restoring the business entertainment deduction; support for the hard-hit meetings and events sector; and tax credits for personal protective equipment (PPE) and facilities sterilization.
  • Protection from frivolous COVID-related lawsuits for businesses that follow proper health and safety guidelines.
  • Provide a federal backstop for the issuance of pandemic risk insurance to give businesses financial cover from future outbreaks or another wave of infections—similar to the Terrorism Risk Insurance Act enacted after 9/11.