Last year, tourism spending in the state reached a record-high of $157.3 billion, up 3% from another record-breaking year in 2023. That money supports millions of workers, largely in the hospitality industry.
However, this year political actions and rhetoric from the Trump administration, like tariffs and claims that the country should become the 51st state, have sparked backlash from Canadians.
This response has taken a toll on California industries, including wine boycotts that are impacting wineries and growers across the state. Canadians are also second-guessing investing in or traveling to the United States, and those drops are already being anticipated.
Earlier this month Visit California, the state’s tourism board, released its annual travel forecast, which projected the first year-over-year decline in visitation since the pandemic.
Ryan Becker, Senior Vice President of Communications and Strategy at Visit California, recently joined Insight Host Vicki Gonzalez to talk about their forecast and the significance of tourism for the state’s economy, as well as how California locals can enjoy their home state.
This interview has been edited for length and clarity.
Interview highlights
California’s tourism landscape
What encompasses the travel economy?
Our focus is really to drive primarily inbound leisure travel to the state. In normal times we are really marketing across the United States and to international travelers, to get them to consider coming to California for their annual holiday or whatever their purpose might be. But more broadly speaking, the travel industry includes group events… anything from an executive retreat up to a city-wide convention, and then you have the more routine business travel as well. Although we're not marketing in that space, it is a key component of the travel industry.
When looking at the revenue that travel produces in California, what does that look like?
Think of travel as an export — it's actually classed as a service export by the Department of Commerce. Think of an international traveler who comes to California. They spend their money here, injecting money into our economy, and then they go home at the end of their trip. They're really a benefit to the overall economy of the state. About 1.2 million California workers depend on that visitor spending to fund their livelihood. In 2024, $157 billion was spent in the state, and that generated almost $13 billion of tax revenue.
Where are the bulk of travelers and tourists in the state coming from?
The lion's share, interestingly enough, are California residents. We're a huge state, 40 million people, and there's such an abundance of things to do right here in our own backyard. About 118 million trips last year were taken by Californians.
Outside that, our key markets are not going to be surprising. Arizona, Texas, New York [are] high up on that list. And then internationally speaking, our neighbors to the north, Canada, and Mexico to the South. And then after that, China is our number three international market.
We may reflexively think of certain attractions or destinations when it comes to tourism, but is the travel picture in California more complex?
The industry really benefits all Californians. The long haul travelers, they're coming through those gateway cities… that’s where the airports are. But then, they're getting out on the open road and they're visiting a lot of hidden gems or off-the-beaten-path destinations. That's a key component of what we do in the marketing space… try to drive travelers outward from some of those gateway cities after they've enjoyed the sites and attractions there.
Every traveler these days, they're looking to immerse themselves in a local destination. They want to learn about the culture and the lifestyle that Californians live. People are coming here not just to see the Golden Gate Bridge or to go to Disneyland — those are on the list — but they're also looking to immerse themselves and learn and kind of feel and soak up that California vibe, that California lifestyle.
Last year was a record in terms of spending for travel. What do you attribute that to?
We've continued to claw our way out from the pandemic. Obviously, travel was off the table for a little while. We finally crested that 2019 pre-pandemic mark in 2023, so 2024 was another year of pretty steady growth. Pretty good economic indicators, globally speaking, where people have some discretionary income. Economics are always going to be the number one thing that determines how and and where people travel. We saw that pretty strong, steady growth — 3% give or take, year-over-year — in terms of visitor spending in the state.
Visitation downturns and political pressures
Moving to this year, how did projections at the start of the year compare to the forecast you released this month?
We were looking [at] another pretty strong year this year. The economic factors have continued to remain pretty strong. Unfortunately, some of the macroeconomic issues that are outside of our control — for example, the strength of the US dollar — have continued to remain a challenge and that really cuts both ways. It makes it more expensive for international travelers to come here, but it also makes it cheaper for Americans to go abroad. Not only do we have a bigger challenge in attracting those international travelers, but we’ve got to try to retain as many Americans and keep them here in California as possible.
And then, some of the rhetoric that we've seen has not been helpful either. Some of the commentary around Canada as [the] 51st state has been taken really, really personally by our neighbors to the north, and they have reacted very strongly. We have seen some of those arrival numbers really start to decline. For the first time since the pandemic, we have revised our forecast for 2025 to show a negative year-over-year visitation number. It's not huge, it's down 0.7% overall…but that is driven by a 9.2% decline in international visitation.
In partnership with the governor's office, Visit California launched a tourism campaign specifically for Canadians. What is special about Canadian tourists?
Canadians are a huge market for us, they're right neck-and-neck with Mexico. Last year 1.8 million Canadian travelers came to the state, they spent over $3 billion. It’s an enormous part of our local travel economy, and it also affects some destinations more than others.
There's a huge Canadian snowbird population that comes down escaping that Canadian winter. They’re all over our desert communities around Palm Springs in Southern California, injecting their spending not just into where they're staying… but the restaurants [and] the retail they’re patronizing while they’re here as our guests. Our approach has been to shore up our marketing there with some specialized outreach designed to show Canadians how much California depends on them — not just from a financial standpoint, it's actually a much more emotional deep connection. Our cultures are really intertwined.
We think of travel as an act of diplomacy. Every time someone comes here, they learn a little bit more about who we are as people and conversely, when we visit their places of residence, we get the same experience. So that emotional connection, I think, is really important to call upon when the factors that are putting some downward pressure on their travel are as emotional as they are economic.
Given that travelling is an emotional decision… anecdotally at least, are you able to get some feedback on why there’s a downturn in travel from Canada?
I would caution against looking too closely at some social media comments… but it is helpful to kind of take the pulse of that and read about the intensity of passion there. It's a hesitation to patronize a country that they feel is attacking their way of life. That's a really hard thing to push back against. The other thing that we are trying to keep in mind is that this is not necessarily a short-term issue that we're going to be grappling with.
We maintain an office in Canada… staffed by Canadians, they are very helpful in helping us understand the sentiment there across the country. We're maintaining a marketing presence there, we spend about $5 million [every year] marketing directly to Canadian consumers, trying to ensure California's on the consideration list. We plan to continue that investment, and the campaign that we launched in conjunction with the governor really helped to break through that and generate some attention for California.
It was really interesting that Canadian media were really refusing to cover anything related to U.S. travel destinations. So with the governor's help, we really broke through that media blackout and got some good headlines to hopefully get California back in that top of mind space.
What is uniquely challenging about marketing California during this time and political climate?
There's a polarization in the country that has made the simplest of consumer choices into political statements. That's a really challenging place to be as a marketer. Everyone travels, we believe that everyone should travel and needs to travel… and that cultural diplomacy I mentioned is a really important byproduct of the travel space.
Like I described in Canada, some media partners didn't want to talk to us because we were from the United States. There's a sense of the same thing in the U.S. at times, where consumers just don't want to hear about California. We're not alone in this space. It is a polarized environment for any marketer, and certainly other travel destinations across the U.S. face some similar challenges.
How to enjoy California
We're getting into summer and people are going to want to hit the road. A big destination are California's national parks and national forests, but this is also in the wake of federal layoffs. What should visitors plan for if they want to go to parks like Yosemite or Lassen?
The first thing to do is check out the national park website nps.gov and then you can link off to specific parks for information about that. We expect this to be a big year for national parks. I think an important part for visitors to understand is that in these parks, the visitor experiences are almost entirely managed by a concessionaire. So while the federal cutbacks were there… from a visitor experience perspective we think that that national park experience is going to be pretty strong this year.
Specific to Yosemite, there is a limited reservation system to access the park. You will need a reservation if you're entering the park on certain dates or certain times of the day, even if you're just driving through the park.
Your forecast also showed that visitor spending grew in 50 out of 58 California counties. Which places in the state deserve a little more TLC?
I would recommend that especially for listeners here in Northern California, really consider the Bay Area. There's so much going on. There's a lot to do in Sonoma County, one of my favorite places in the state to visit… goes all the way from the wine country over to the Pacific Coast.
There's a few things that I would mention… River Electric in Guerneville, kind of a camp resort and swim club that is opening. And then, Appalachian Healdsburg is a new luxury hotel that's opening this summer and it's going to feature a rooftop bar by Charlie Palmer, so that should be a pretty cool place to hang out.
Finally, things are getting more expensive and it all adds up. If you want to spend time outside of your own home, what advice do you have for those who want to explore but maybe feel priced out?
Stay close to home. I think that's a real message for all Californians, and certainly from the travel industry's perspective. We want to have all Californians consider a trip over the summer right here in our home state. You don't have to go far to find an experience that's perfect for you and your traveling partners. There's plenty of ways that you can do things on a cheaper budget.
Presidio Tunnel Tops in San Francisco… if you haven't checked that out you should, it's a perfect picnic spot. So pack a lunch, jump in the car, head over, take the kids, and that should be a spectacular way to spend an afternoon wandering around one of the world's iconic cities.