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Does USA's Drop in Popularity as a Destination Signal a Recession?

8 Jan, 2020

By: Mary Helen Sprecher

The potential impact of tariffs and heightened security policies governing admittance to the U.S. have been concerns in many business sectors for some time. However, here’s something many in the sports and travel industry don’t realize: the U.S., for all its appeal, is lagging behind other nations in its ability to bring in tourism – including sports tourism – from outside its borders.

In fact, the U.S. Travel Association (USTA) has estimated the decline would translate to a loss to the U.S. economy of $78 billion in visitor spending and 130,000 American jobs. As a consequence of the decline since 2015, it said the economy has already lost $59 billion and 120,000 jobs through 2018.

According to an article in HotelManagement.net, the USTA says it’s imperative that the trend be turned around, lest it prove to be part of a much greater problem.

“Making [international inbound travel's] pace of growth a national priority could be a difference-maker in helping to keep the country out of a recession,” USTA President/CEO Roger Dow said in a statement. “Right now, the country is not capturing the full economic potential of overseas travel, but there are some turnkey policy solutions that could help to address that—starting with congressional reauthorization of the Brand USA tourism marketing organization.”

Brand USA is the destination marketing organization for the U.S. as a whole, with the overarching mission of increasing incremental international visitation, spend, and market share to fuel the nation’s economy and enhance the image of the USA worldwide. (U.S. Travel said it remains hopeful that the House Energy and Commerce Committee will advance the Brand USA reauthorization bill in time for a full House vote.)

The association also found the domestic travel market to be slowing. It estimated it will increase just 1.4 percent in 2020, the slowest pace in four years.

While sports tourism has enjoyed years of strength as a market, nothing is recession-proof. The nation has a plethora of facilities and events – and a youth market that is getting less active. According to the Sports & Fitness Industry Association’s recent State of the Industry Report:

“In 2018, over 82 million Americans were inactive—measured by individuals who self-reported doing no physical activity in a 12-month period. This is up roughly 700,000 over the previous year. The country’s rate of inactivity has risen over the past five years, climbing from 26.5 percent of the population in 2013 to 27.3 percent in 2018.”

In addition, the report notes, it can create dire economic consequences for the industry: “The potential economic impact is dire as well, particularly to the health of the sports and fitness industry. When asked what most concerns them heading into 2019, industry members overwhelming placed a decline in sports participation at the top of their list.”

It's early in the new year to be making predictions, but there’s definite cause for concern. Sports Destination Management will continue to follow the developments in the international travel market, and their potential ramifications.

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