Coming to America: U.S. Cities Attract More Global Tourists

Travelers from far-flung nations flocked to the U.S. last year, particularly to popular destinations like New York City.

Overall in 2010, New York attracted a record-breaking 48.7 million visitors, who spent a collective $31 billion. Of those, only 9.7 million -- about 20% -- hailed from abroad, but those foreign visitors accounted for $15.5 billion, or half, of the spending.

For all of the U.S., international travelers numbered 59.3 million last year, out of a total of 2.16 billion travelers, according to data from the U.S. Travel Association, an industry trade group. And 25.8 million of the foreign visitors came from countries other than neighboring Canada and Mexico.

Where did they go? The most popular U.S. destinations for foreign visitors included New York, Orlando, Las Vegas, San Francisco, Los Angeles and Chicago, says Suzanne Cook, a senior adviser to the association. "When people start visiting the country, they go to iconic destinations," she says.

Deep Pockets

Foreign visitors to the U.S. probably spend about five times as much money as domestic visitors, on average, she adds. "The length of their stay is longer; they're more likely to use hotels," she says. "And many who are on leisure trips have more time to spend money."

Under its current mayor, Michael Bloomberg, New York has developed an aggressive strategy to promote itself as a travel destination worldwide. It now has 18 offices in 25 markets throughout North and South America, Europe, Asia and Australia.

This strategy evidently is paying off: Foreign visitors to the city increased 13% last year, compared to a 5.3% increase in domestic visitors. NYC & Co., the city's official marketing and tourism organization, said the biggest growth came from
China and Hong Kong, up 47%; South Korea, up 35%; Brazil up 27%; Australia up 21%; and India and Argentina, each up 16%.

For the U.S. as a whole, South Korea was the seventh-biggest generator of overseas visitors, while Brazil was the eighth and the China -- excluding Hong Kong -- was the 11th, according to U.S. Department of Commerce data from January through September of 2010. In that same period, the number of foreign visitors to the U.S. grew 8% year over year, compared to only a 3.1% increase in domestic travelers.

"The combination of a weak dollar and nominal price reductions for such purchases as hotel stays, restaurant meals and many retail items has made the U.S., and especially New York, a bargain for many international travelers," says Bjorn Hanson, divisional dean of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at New York University.

NYC to Remain a Hot Spot

At a press conference last week, Mayor Bloomberg and George Fertitta, chief executive of NYC & Co., predicted the city would attract 50 million annual visitors by 2012, a goal the mayor set back in 2007, before the economic meltdown. This growth is important to the general health of New York's economy because travel and tourism is the city's fifth-biggest industry, supporting over 300,000 jobs.

NYU's Hanson, in fact, predicts the city might well exceed its 50 million-visitor goal this year. He estimates New York's lodging demand will increase more than 5% in 2011, compared to a "slightly more than 3% increase" in U.S. lodging demand. Fertitta predicts New York will see a 3% increase in total visitors -- including both domestic and international -- this year.

According to national data released by the Commerce Department late last month, real spending on travel and tourism grew 8% in the third quarter of 2010, compared to an increase of 3.4% in the second quarter. By comparison, real gross domestic product rose 2.5% in the third quarter and 1.7% in the second quarter.

And even with the current boom in foreign tourism, the Commerce Department says, "it still remains below its peak set" in the third quarter of 2007. Judging from the crowds in Times Square these days, that's hard to imagine.