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Washington Post
2 days ago
- Business
- Washington Post
Americans are downsizing their summer vacations
Americans are downsizing their summer vacations — taking shorter trips, driving instead of flying, and generally staying closer to home in an uncertain economy. Families appear to be pulling back on travel spending, after years of splurging on vacations and other experiences after the pandemic-era shutdowns. Fewer households are booking airline tickets or hotel rooms now than they were a year ago, Bank of America data shows. And the number of people taking vacation time off work in June dropped to its lowest level since the pandemic, according to Labor Department data. That pullback follows months of economic warning signs. Americans say they are feeling worse about the economy than they have in years, as new trade and immigration policies take hold. Many are bracing for a spike in prices from new tariffs, while others are worried about losing their jobs in a slowing labor market. Renewed tariff threats last week — including rates as high as 50 percent on goods from Brazil, Japan and Canada starting Aug. 1 — have added to fears that a new round of inflation may be around the corner. Consumer spending dropped in May, as households put more of their incomes in savings in anticipation of higher costs. In all, Americans expect to spend an average $3,132 on summer vacations this year, about 25 percent less than the $4,199 they set aside last summer, according to an annual survey conducted by Ipsos for Generali Global Assistance. 'The spending slowdown is real,' said Diane Swonk, chief economist at KPMG. 'Consumers are stressed, and this is where we're seeing it first: in domestic flights, hotels, and a lot of other service-sector spending.' Although the wealthiest Americans are still splurging on international travel and booking hotel rooms that cost $800 a night or more, most others are retrenching, Swonk said. U.S. hotel occupancy rates fell 1.7 percent in June from a year earlier, marking the fourth straight month of declines, according to real estate analytics firm CoStar. To keep up, hotels and resorts across the country are going to greater lengths to woo locals and road-trippers, rolling out 'daycation' deals, free parking and discounted spa services to tap into a growing pool of Americans who want a break without breaking the bank. 'This summer, it's definitely staycation season,' said Madelyn Lydon, assistant director of marketing at the Arizona Biltmore, a resort in Phoenix. The hotel is offering a 40 percent discount and free parking for visitors from seven nearby states in hopes of attracting more road-trippers. Same-day bookings have picked up, along with demand for day passes, Lydon said, as more people choose the resort and its pools as a last-minute substitute for longer, pricier vacations. Years of inflation, coupled with rising health care, insurance and utility costs, have pinched household budgets. Credit card balances, at $1.2 trillion, are near an all-time high, and delinquency rates are rising on mortgages and student loans as more Americans fall behind on everyday expenses. Getting away for the summer this year has required extra scrimping for Chelsea Padilla, a middle school teacher near Galveston, Texas, whose monthly mortgage bill recently rose by $200 because of higher taxes and insurance costs. Instead of traveling with her family of five, she has stuck to a smaller getaway with just her 16-year-old daughter this month. She bought plane tickets to Destin, Florida, using credit card points. And unlike the nice hotel suite they splurged on last summer, Padilla found a no-frills property a few miles from the beach that included free breakfast. They ate fruit and snacks from the grocery store for lunch, and they usually split an entrée for dinner to save money. 'It's became a real balance between the pressures of rising costs and still being able to enjoy our lives,' said Padilla, 41. 'We're being as thrifty as we can.' Southwest Airlines, American Airlines and JetBlue have all warned that slowing domestic demand could weigh on profits this year. Delta Air Lines last week reported a 4 percent drop in main cabin bookings in the first six months of the year, compared with a year earlier. (Notably, premium tickets, for first- and business-class seats, rose by 6 percent during the same period.) Last summer, Sam Head and his family went on three vacations, twice to Florida and once to Las Vegas. This year, the Milwaukee-based family is sticking to a long weekend in Wisconsin Dells to visit multiple water parks. Business at Head's recruiting firm has slowed dramatically, he said, which has made him nervous about the economy. Instead of splurging on travel, Head said, he is focused on saving up a year's worth of extra cash. 'Do I worry about where things are going? Of course. I already see it in my numbers,' the 35-year-old said. 'We're cutting back on any nondiscretionary spending so we can keep more money in our pockets.' Most Americans — 56 percent — say they plan to travel less this summer, according to a national poll by SSRS. Many said they were opting for shorter or 'more budget-conscious' trips because of financial concerns, with 54 percent saying they would be trying to save more money this year. In New Paltz, New York, Danielle Dippel, 40, and her boyfriend spent months arranging a week-long vacation in Kennebunkport, Maine — then promptly scrapped that plan when financial jitters got in the way. Between government funding cuts at her job at a historical site and growing economic uncertainty, Dippel said it no longer made sense to spend $2,000 on a summer trip. Instead, the couple plans to drive four hours to Newport, Rhode Island, where they will spend four nights. 'We're trying to cram everything into three days,' Dippel said. 'It's about $700 cheaper. And we won't have to be away from our cat very long.'
Forbes
07-06-2025
- Business
- Forbes
Inside America's Short-Trip Summer – And How To Make The Most Of It
Summmer vacations are getting shorter, but Americans want more from them. Here's how they're getting it. getty If you're thinking of taking a summer vacation, you'd better think fast. A new survey by Generali Global Assistance (GGA) suggests travelers are planning trips averaging just 1 ½ weeks, significantly shorter than the typical 2-week summer vacation. They're also booking far in advance. Why is this happening? "American travelers are opting for shorter, closer-to-home trips shaped by economic realities, such as inflation and flight prices," says Chris Carnicelli, CEO of Generali Global Assistance. So what does this trend mean for your summer vacation? The findings, outlined in GGA's 2025 Holiday Barometer, suggest American travelers are more cautious than they've been at any time since the pandemic. "Economic pressures appear to be shaping American travel behavior in 2025," says Carnicelli. The shorter trips, plus more advance planning, add up to a greater emotional investment in the vacations — in other words, to ramped-up expectations. While GGA has seen a decrease in budgets, some travel suppliers say there's an explanation: Even as Americans shorten their vacations, they're sometimes spending more on a per-day basis. "Shorter stays are dominating," says Janice Wilson, who runs a new luxury glamping resort near Washington's Olympic National Park. "Most of our guests this season are booking two- to three-night stays. And it seems they make up for brevity with indulgence. They're downright spendy when purchasing our curated add-ons like our caviar hot dogs or couples massage on their private decks." Chris Carnicelli, CEO of Generali Global Assistance. ADP "Economic pressures appear to be shaping American travel behavior in 2025." What's with the abbreviated vacations? Alex Alioto, head of growth at Whimstay, a vacation rental site, blames the shaky economy. "The travel industry is witnessing a notable shift this summer as Americans increasingly adjust their travel plans in response to economic pressures," he says. "The trend toward shorter stays is a direct result of that." GGA's Carnicelli says there's also a deeper sense of uncertainty — not just economic — that's making Americans more cautious about their vacations. "Political developments in certain international destinations may be prompting travelers to stay closer to home," he says. Perhaps the most decisive factor is the hassle of traveling. "This isn't driven by fear, but by practicality," notes Anthony Radchenko, CEO of AirAdvisor. "With disruptions caused by extreme weather, labor strikes, and lingering confusion around REAL ID enforcement, people are adapting. They're planning shorter, simpler trips that minimize stress and maximize control.' "In spite of all the doom and gloom, summer is most certainly heating up — even if some travelers are still playing it cool when it comes to booking," Travel companies are catering to the faster vacationer this summer. You can find these travel opportunities almost anywhere. Gondwana Ecotours, a tour operator that specializes in small-group trips to places like Alaska, Patagonia, and Tanzania, has seen an uptick in interest from travelers. Its tours are packed with activities that align with the current travel trends. "For example, our eight-day Northern Lights Adventure in Alaska has been popular with travelers seeking a unique and manageable domestic trip with unforgettable moments such as seeing the aurora borealis, walking with reindeer, and soaking in natural hot springs," says Eric Segalstad, a vice president at Gondwana. At the Four Seasons Hotel Las Vegas, the focus this summer is on events that bring in guests for just a few nights. Sin City is within driving distance of Los Angeles, San Diego, Phoenix, and Salt Lake City, making it a desirable domestic destination. "This summer, we're seeing Americans lean into event-based travel," says Liza Costandino, a spokeswoman for the Four Seasons. Major acts like Kendrick Lamar, Coldplay, Shakira, The Weeknd, and Beyoncé will be in town, and visitors are coming for three to four days and building a summer vacation around the event, says Costandino. If you want to take a shorter summer vacation without overpaying, experts say there's still time. He says average prices for July are up 9 percent from the same time last year to $320 per night. For August, they're up 12 percent from last year, to $324. But good news: They will probably come down again when summer's over. America's summer seems to be trading sprawl for spark. Shorter stays, booked smarter and splurged harder, are blueprints for the latest vacations. Whether you're chasing auroras in Alaska or belting lyrics in Vegas, the message is clear: go small — and book soon.
