The Impact of COVID-19 on the United States Travel Economy 2020 Analysis April 15, 2020 Key Findings Overview Oxford Economics, in coordination with its Tourism Economics subsidiary company, modeled the expected downturns in the US travel industry in 2020 as a result of Coronavirus. We then modeled the economic impacts of these travel industry losses in terms of GDP, unemployment, and taxes. Travel Industry Losses “FLATTENING THE CURVE” OF THE TRAVEL DOWNTURN A decline of 45% for the entire year is expected. This includes an 81% drop in revenue over the next two months and continued losses over the rest of the year reaching $519 billion. A scenario model was run to assess the potential gains of a more tempered downturn beginning in June. GDP Losses The mitigated downturn scenario assumes a variety of efforts to lessen the severity of declines in travel beginning in June. Travel industry losses will result in a cumulative GDP impact of $651 billion in 2020. We project the US economy to enter a protracted recession based on the expected downturn in travel alone. These include opening of travel businesses on a region-by-region basis, enhanced traveler safety measures, and a robust array of marketing campaigns to encourage travel among low risk US residents. The recession is likely to last at least two quarters with the lowest point in the second quarter of 2020. Tax Losses A decline of $80 billion in taxes will be realized as a result of travel declines in 2020. These mitigating efforts hold the potential to “flatten the curve” of losses, resulting in a cumulative dec