California welcomes millions of visitors annually.
California Governor Gavin Newsom has warned that the Golden State’s tourism revenue could be in jeopardy in 2025, even on the heels of a record-breaking 2024.
“California dominates as a premier destination for travelers throughout the nation and around the globe. With diverse landscapes, top-rate attractions, and welcoming communities, California welcomes millions of visitors every year. We also recognize that our state’s progress is threatened by the economic impacts of this federal administration, and are committed to working to protect jobs and ensure all Californians benefit from a thriving tourism industry,” Newsom said in a statement Monday.
The statement also trumpeted the achievements of California’s tourism industry in 2024, even as it shifted its outlook downward for 2025. Visitors to California directly spent over $157 billion at California businesses last year, and contributed another $12.6 billion in direct state and local taxes.
However, there are warning signs on the horizon that the state’s tourism fortunes might not last, which Newsom, a Democrat, attributes to “federal economic policy and an impending ‘Trump Slump.’” The forecast anticipates a 9.2% decline in international visitors for 2025, which would lead to an overall 1% decline in visitor traffic compared to 2024.
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The forecast is an amended estimate, based on statistics for the first quarter. Air arrivals from Canada decreased in February and March. Arrivals from Mexico—another top inbound destination for California—are also reported down compared to last year.
Some California cities, such as Palm Springs, have already noted a decline in Canadian travelers. Canada is the largest foreign market for inbound travelers to California. Governor Newsom has already announced a plan to more aggressively market California as a destination to Canadian and other international travelers in an attempt to stem some of the projected losses.
Several California destinations are already facing difficulties from a combination of factors. Los Angeles area communities are fighting traveler perceptions that they haven’t yet reopened for business following a series of fires in January, and Yosemite National Park has faced a rollercoaster of questions over staffing and reservations.
In spite of each community’s tourism challenges, there are plenty of reasons to visit the Golden State—not least of which is the incredible diversity of destinations available for travelers to explore. Literary fans can head to Salinas, also known as the “Salad Bowl of the World” to check out the National Steinbeck Center Museum or try an artichoke cupcake on the Artichoke Trail. Nearby, travelers can take an electric boat eco-tour through Elkhorn Slough, which could be described as “a five-star hotel for sea otters.”
Further down Highway One, a.k.a. the Pacific Coast Highway heading south to San Luis Obispo County, travelers can peer into the opulence of Hearst Castle, explore a historic lighthouse, or spot sea lions on the beach while breezing through charming towns like the art-forward Cambria, or the laid-back, surfer-vibe Cayucos.
Elsewhere in the state, visitors can visit with California’s diverse tribal communities and learn about cultures that long pre-date European contact, trace the legacy of California’s Black Cowboys, or “set jet,” not just in Los Angeles, but in the San Francisco Bay Area, which was a popular setting for multiple sitcoms of the 1990s.
California’s annual GDP of $4.1 trillion recently put it ahead of Japan in rankings of the world’s largest economies. If California were a separate country, it would have the world’s fourth-largest economy.
Visit California notes that although visitor spending reached a record in 2024, international visitor spending is still down compared to 2018, the most recent peak year, primarily due to a slow recovery in visitor numbers from China and other parts of Asia following the COVID-19 pandemic.
