Decline in tourism adds to Los Angeles' economic woes

Los Angeles has seen a decline in tourism this summer, adding to its economic woes.

Amid the wildfires, tariffs, and immigration raids, international tourist arrivals fell by 8% in the three months through August, according to data released from Visit California on Monday, the Los Angeles Times reported. In total, that means there are more than 170,000 fewer global tourists than last year.

In August, arrivals dropped by 7.5% compared to 2024.

California hit a new high in tourism last year, with visitors spending $157.3 billion, up 3% from 2023, and creating 24,000 jobs, according to Visit California.

The most significant absence of international tourists was Canadians, as the number of visitors from Canada dropped by 32% in the three summer months. This follows President Trump talking about making Canada the 51st state and hitting the country with tariffs.

Palm Springs Mayor Ron deHarte said that summer in his city was okay this year, but that was because domestic tourists offset the sharp decline in Canadians.

"We've hurt our Canadian friends with actions that the administration has taken. It's understandable," deHarte said. "We don't know how long they won't want to travel to the States, but we're hopeful that it is short-term."

Tourists from Australia, China, Germany, and India also avoided the state. However, Mexican tourists increased by about 5%.

L.A.'s Hotel Assn. President Jackie Filla said that Los Angeles is seeing a decline in hotel room occupancy and in the number of traveling events. This comes with the industry facing higher labor costs. The hourly minimum wage for hotel workers in California is set to increase to $25 in July 2026, $27.50 in July 2027, and $30 in July 2028, right before the Olympic Games.

“Hotels were not back to pre-pandemic numbers when the wildfires hit," Filla said. "The adoption of recent regulations that have steeply escalated labor costs have created additional challenges for hotels and the hundreds of small businesses within them.“

Adam Burke, president of Los Angeles Tourism, told the Times, “Los Angeles is California’s primary international gateway; the impacts are felt statewide. Looking ahead, long-term recovery will depend on global economic conditions and how the U.S. is perceived abroad."