Monthly Travel Indicators Summary - March 2024

Executive Summary Domestic

Macroeconomic

• While under control relative to the prior two years, inflation continues to be a challenge for the U.S. economy, which is ticking up again this month. Gas prices have also increased, but this reflects seasonal trends. Otherwise, strong job growth, low unemployment and rising consumer confidence point to a healthy economy.
• Inflation for the month was 3.5%, up slightly for the second month in a row. The national average retail price for a gallon of gas was $3.54 (vs. $3.33 the previous month). The California equivalent price was $4.83 (vs. $4.54 the preceding month).
• Approximately 303,000 jobs were added to the economy, an increase over last month’s 270,000 jobs. The unemployment rate was 3.8% (vs. 3.9% the previous month).
• The University of Michigan tracked U.S. consumer sentiment on the economy to 79.4, up from the 76.9 measurement in February.

Forecast (updated February, June & October)

• Domestic visitor spending is forecast to reach $130B in 2024. According to the Visit California February 2024 forecast, domestic visitor spending in California is expected to reach $130 billion in 2024, with $101 billion in leisure spending and $30 billion in business spending. Leisure spending is forecast to grow by 3%, and business spending by 10% relative to 2023.

Consumer Sentiment

• Among American travelers, consumer sentiment around their financial situation and travel outlook remained highly positive, and there was a strong interest in domestic travel as the summer travel season quickly approached.
• The incidence of U.S. consumers planning domestic leisure travel in the next 12 months was a record high of 52%.
• According to YouGov, the price of travel continued to be the primary barrier, with 39% of domestic consumers citing this factor (compared to 42% the prior month).
• A third of American travelers (33%) felt optimistic about their current financial situation relative to a year ago (California residents were more optimistic at 42%). They are even more confident about their future economic situation (48% of the U.S. and 55% of California residents expect more positive).
• Most American travelers increasingly said travel was a budget priority (59%, +4 pts. from the prior month). Californians are likelier to say travel is a budget priority relative to the overall U.S. (61%).
• American travelers were excited about future travel, with 87% of U.S. travelers (and 90% of California residents) saying they were excited about leisure travel in the next 12 months.

Lodging

• Hotel metrics improved slightly in March from a sluggish February, but room demand growth remained elusive through the first quarter. The U.S. is seeing a comparable slow start to the year overall.
• Hotel room demand growth in the state was flat year over year and down 8% from 2019 levels. Regions with positive growth rates included the San Francisco Bay Area, Central Coast and High Sierra.
• California’s monthly occupancy rate was 68% (-2% YOY). The state's ADR was $189 (flat YOY), and RevPAR was $128 (-2% YOY).
• Group room demand was down 5% year-over-year and down 29% from 2019.
• Short-term vacation rentals saw growth on all three metrics (occupancy, ADR and RevPAR) , with 6% growth in RevPAR for the month.

Airlift

• Passenger traffic measured by TSA checkpoints continued to grow on a year-over-year basis.
• Seventy-seven million passengers were screened at TSA checkpoints for the month (+8% YOY).
• There were 9.2 million non-stop seats to California destinations for the month (-1% YOY).

Executive Summary International

Forecast (updated February, June & October)

• International travel spending in California is forecasted to fully recover in 2024, driven by Mexico, Canada, and key overseas markets. International visitor spending in the state is forecast to reach $29B in 2024, according to the February 2024 forecast.
• North American neighbors Mexico and Canada are forecasted to be California’s largest spending markets, with spending of $4.6B and $3.9B, respectively.
• China and India are the most significant overseas markets, with visitor spending of $2.2B and $1.8B, respectively.
• While most of California’s 13 priority markets will have fully recovered to prepandemic spending levels in 2024, China’s recovery is forecast to reach 81%.

Consumer Sentiment

• International leisure travel intent remained robust in California’s priority markets, while travel prices remained the top barrier in all markets.
• On average, across California’s priority markets, 42% of international consumers said they were planning international leisure travel in the next 12 months, flat with the prior month but up from 38% a year ago. Travelers in all 13 of Visit California’s priority markets were increasingly likely to travel internationally relative to a year ago,
• Travel prices remained the primary barrier to travel (44% citing travel price, -1 pt MOM). South Korea (54%), Canada (54%), Australia (51%), and France (49%) were the markets with consumers most likely to indicate prices were a barrier to travel.
• Safety and health concerns remained secondary barriers in the Asia Pacific, India, and Middle East markets.

Airlift/Arrivals

• International airlift continued to grow strongly year over year in March. Arrivals from California’s priority markets saw double-digit growth. Chinese travelers continued to find ways to reach California despite a stagnant recovery in non-stop seats from mainland China. Arrivals from China recovered to an impressive 71% for the month.
• For the month, 1.5M non-stop seats were sold from California’s 13 priority markets, a 15% year-over-year growth rate. Airlift from China grew in March with 57K seats, up 354% from 2023.
• Arrivals through California’s ports of entry were up 17% year over year but down 14% from 2019 levels for California’s priority markets. China arrivals recovered to 71% for the month.