≡-Canada’s Tourism Evolution From Shifting U.S. Travel Trends to Robust Domestic Growth and Rising International Interest Here’s All You Need to Know About the Changing Landscape of Canadian Travel and Its Worldwide Impact – Viral of Today

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Canada’s Tourism Evolution From Shifting U.S. Travel Trends to Robust Domestic Growth and Rising International Interest Here’s All You Need to Know About the Changing Landscape of Canadian Travel and Its Worldwide Impact

Thursday, June 26, 2025

It has been indicated that tourism spending in Canada is projected to rise by a moderate but meaningful 2–4% in 2025. While this increase may not match the post-pandemic surge of 15%, it reflects a steady and resilient performance in a year when other sectors might not fare as well. This outlook also puts Canada in a stronger position compared to the United States, where international visitor expenditures are expected to fall by approximately 7%.

Snapshot: Where Money Is Being Spent

In 2024, tourism-related activities across Canada totaled around $100 billion, encompassing both business and leisure travel by residents and international visitors. A significant 75% of that amount came from Canadian travelers exploring their own country, whether taking quick getaways or longer journeys. The remaining 25% was contributed by international visitors, with U.S. travelers making up the bulk. In fact, Americans were responsible for four out of every five foreign visits, injecting an impressive $15 billion into the Canadian economy—more than all other nations combined.

The Pandemic’s Precedent and Recovery

The COVID-19 pandemic dealt a harsh blow to Canada’s tourism industry, with spending falling by more than half in 2020. Since then, the sector has staged a strong comeback. American tourists led the international rebound, but non-U.S. international travel still hasn’t fully returned to pre-2020 levels. On the domestic front, however, the recovery has been even stronger. Compared to 2019, local trips were up by 6%, and the money spent rose by a remarkable 30%, highlighting a clear preference among Canadians to explore within their own borders.

U.S. Visits: A Weakening Trend

Unfortunately, U.S. visitation is on the decline in 2025. Persistent trade frictions, an uncertain economic climate, and a weakened U.S. dollar are contributing to this downturn. For instance, in May 2025, car travel from the U.S. to Canada dropped by 8.4%, marking the fourth consecutive month of year-over-year decreases. Border communities are feeling the pinch, with some businesses—particularly in retail and duty-free sectors—reporting sales declines of up to 80%. With these trends in mind, U.S. spending in Canada could dip by 5–10%, translating into an estimated $1 billion loss for the year, with improvements unlikely until late 2025.

Upward Momentum from Non-U.S. Markets

On a more encouraging note, travel from non-U.S. countries is on the rise. Digital interest, as tracked through Google Trends, has shown a noticeable increase in searches related to Canada during March and April 2025. Real-world data backs this up: visits from the United Kingdom surged by 14% in April, while Mexico saw a 22% increase, and China posted an 11% year-over-year gain in May. Though these travelers represent a smaller share overall, their growth is seen as a positive trend, potentially adding around $0.3 billion to the country’s tourism revenue in 2025.

Domestic Tourism: The True Linchpin

Perhaps the most vital pillar of support comes from Canadians choosing to travel within their own country. Despite ongoing concerns about inflation and job security, early signs for 2025 are encouraging. A surge of nearly 20% in domestic travel searches has been reported, and a national survey found that 64% of Canadians intend to vacation domestically this year.

Passenger volume for domestic flights also increased by 7.4% in April, indicating rising interest in local destinations. Hotel occupancy trends tell a similar story: British Columbia, for example, recorded a high 68.7% occupancy rate in April—the highest among all provinces. Additionally, government incentives such as the Canada Strong Pass, discounted access to national parks, museums, and VIA Rail, along with the April 1 carbon tax reduction, have made local travel more attractive and accessible.

Interestingly, while fewer Americans are visiting Canada, even fewer Canadians are heading south. In May, Canadian return trips from the U.S. dropped sharply—38% by car and 24% by air. Many “snowbirds”—typically older, high-spending travelers—have either canceled or scaled back their U.S. travel, choosing instead to explore Canadian destinations, further reinforcing domestic growth.

That said, potential economic slowdowns or labour market pressures could limit how much Canadians are willing to spend on travel. But if consumer confidence improves and trade concerns ease, domestic spending could rise another 4%, contributing an extra $3 billion to the economy.

Balancing the Scales

All told, Canada’s tourism industry in 2025 appears to be balancing contrasting trends. The decline in U.S. travel is undeniably a setback, but it’s being offset by increased domestic tourism and a budding revival in non-U.S. international travel. These opposing dynamics are expected to result in an overall tourism spending increase of $2–4 billion for the year—an outcome that underscores the sector’s resilience.

Looking Ahead to 2026

Looking beyond the current year, 2026 promises to be a game-changer. Canada’s role as a co-host of the 2026 FIFA World Cup could attract massive international attention, with visitors pouring in from around the globe. This major sporting event is poised to give a substantial boost to both GDP and employment in the tourism sector. As the country begins preparations, 2025 may serve as the launchpad for a historic upswing in Canadian tourism.

Global Impact on Travelers and the Travel Industry

This shift in travel behavior—especially the drop in U.S. outbound travel—could have ripple effects across the global tourism landscape. As Canadians rediscover local destinations, industry stakeholders including airlines, hotels, and tourism boards may need to redirect efforts toward local and international (non-U.S.) markets. For global travelers, Canada is emerging as a stable, diverse, and increasingly attractive destination. With momentum building toward 2026, the country is well-positioned to solidify its place on the world tourism stage.

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