Tariffs, Travel, and Turbulence: Full Recovery Now Delayed Until 2029

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The global travel industry is bracing for a longer-than-expected recovery period, with economists now projecting that international travel won’t return to pre-pandemic levels until 2029. This revised forecast, shared by Tourism Economics President Adam Sacks during a recent webinar, marks a stark shift from earlier expectations of a full rebound by 2025.

According to Sacks, the ten-year gap between 2019 and full recovery is likely to result in substantial economic losses for the tourism sector. Contributing factors include not only pandemic aftershocks but also a volatile global economy, strained international relations, and intensifying trade policies under the current U.S. administration.

Tariffs, Inflation, and Supply Chain Stress

The “Trump & the Travel Industry” webinar also highlighted broader macroeconomic pressures, particularly the impact of evolving tariff policies. Ryan Sweet, Chief U.S. Economist at Oxford Economics, noted that the country is facing four key economic shocks, all interconnected and largely influenced by trade decisions. These include rising tariffs, disrupted supply chains, financial market volatility, and inflationary pressures.

The inflation shock, in particular, is expected to hit hard, with some goods facing nearly 10% price increases due to tariffs. Supply chains are also under stress, with companies stockpiling goods in anticipation of further disruptions. Sweet pointed out that the shift from globalisation toward protectionism is creating bottlenecks and forcing businesses to operate with uncertainty.

Travel Behavior and Sentiment Shift

On the consumer side, changing travel sentiment is already visible. A recent flash poll by MMGY found that while 83% of Americans still plan to travel this year, 80% will alter their plans—many opting for domestic destinations over international ones. Additionally, over half of those surveyed believe U.S. travellers may face hostility abroad due to policy and rhetoric.

As international visitor numbers to the U.S. drop and domestic travel alone fails to offset losses, the industry faces a prolonged path to normalcy. Economists remain cautiously optimistic that broader recovery will begin in 2026, but only if clarity and consistency return to policy and global relations.