California is No. 1 state for tourism, but may be hit by 'Trump Slump,' Newsom says

Sandra McDonald, Los Angeles Times on May 5, 2025

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California hit a new tourism record in 2024, Gov. Gavin Newsom announced Monday, but the high isn’t expected to last thanks to President Trump’s tariffs.

Tourism spending last year hit $157.3 billion, up 3% from 2023, and created 24,000 jobs, according to a 2024 economic impact report from Visit California, the state’s nonprofit marketing agency.

California is still the No. 1 state for tourism and has the fourth largest economy in the world, but next year it expects a 1% decline in visitation and a 9.2% downturn in international tourism, “in direct response to federal economic policy and an impending ‘Trump Slump,’” according to a statement from the governor’s office.

Local LA tour groups and knickknack shops, usually booming at this time of year from spring break travel, have said the uncertainty of tariffs and the trade war’s effect on the stock market have turned people away from local travel.

But it’s not just local — Canadians have canceled plans to travel to California for events such as Coachella because of Trump’s aggressive 25% tariff on Canadian goods, worrying officials in desert towns that rely on snowbirds for income. Newsom announced a marketing plan to invite Canadians back to California after February figures showed a 12% drop compared with the same month in 2024.

In the Los Angeles area alone, the tourism and hospitality industry employs about 510,000 workers and supports more than 1,000 local businesses, according to the Los Angeles Tourism and Convention Board.

Last month, Tourism Economics, a Philadelphia-based travel data company, predicted that international travel to the U.S. could decrease 5% this year, with a 15% decline in travel from Canada.

In San Diego, home to Comic Con, some of California’s most beautiful beaches and the “Smithsonian of the West” in Balboa Park, tourism employs 1 in 8 residents and brought $14.8 billion in earnings in 2024. With 32.5 million visitors last year, it’s one of the country’s top travel destinations.

“Uncertainty is the new norm,” said Kerri Kapich, chief operating officer at the San Diego Tourism Authority.

Constant change makes it hard to plan ahead, she said. As travel slows or stays even from last year it will affect the local economy. Fewer hotel stays, fewer restaurant checks and less money spent in the community overall could mean fewer jobs too.

The uncertainty around international trade policy will affect the state budget, with unclear revenue and rising disaster recovery costs clouding the upcoming revision expected next week from Sacramento. Newsom sued the Trump administration in response, arguing that the president doesn’t have authority to levy international tariffs without congressional approval.