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Is President Trump bad for tourism?

By Melissa Mahtani CNN

(CNN) -- President Trump pledged to boost the US economy with more jobs and growth, but one sector of the economy -- tourism -- has taken an early hit, industry leaders say.

Trump's January 27 executive order banning some travelers from entering the country led to chaos at airports and sparked protests at home and abroad. The order banned people from seven predominantly Muslim countries, including preapproved visa and green card holders.

The ban was challenged in US courts and temporarily halted on February 3 but various international travel firms have reported a downturn in people looking to take vacations in the United States.

Cheapflights, an online travel site, reported a 30% drop in international searches for flights to the United States the weekend of the ban, compared to the average of the previous three weeks. This picked up slightly when the ban was temporarily lifted but remained 14% lower than the average volume in January.

Emily Fisher, a spokeswoman for the company, said, "It's been interesting to see that the decline has continued even after the courts blocked the initial ban. That seems to indicate there is a slice of international travelers who will continue to steer clear of the US as long there is an effort to ban select populations."

Tour operator Intrepid Travel reported a "noticeable decrease" in bookings after January 27. Intrepid's North America Director Leigh Barnes said, "From January 1-27, bookings to the United States were up 120% from Australia and 96% from the United Kingdom. However, from January 27, the day the travel ban was announced, through February 16, actual bookings to the United States were down 21% from Australia and 30% from the United Kingdom."

The CEO of travel site Expedia, Dara Khosrowshahi, addressed the travel ban on the company's most recent earnings call, saying, "We have seen an effect on trading on a short-term basis. The weekend of the executive order, certainly we saw a negative effect on trading. We haven't observed anything meaningful on a trend basis so far ... which is good news. We'll be watching it closely."

The global travel intelligence platform Skift said 2017 was always going to be a bad year because of the strength of the dollar and weakness of the British pound. Skift Editor-in-Chief Jason Clampet said, "People vote first with their wallet. But if you add to that the general confusion/unease that Trump's actions are imparting to leisure travelers (who can choose where they want to go), and business travelers (who have corporate policies to consider) we should be prepared for a significant hit to US tourism."

It's not just tourism that's taking a hit. Corporate leaders fear Trump's pledged changes to the current visa system and a crackdown on immigration could hurt overall productivity in the labor force. CEOs of major American companies like Starbucks, Google, GE, Goldman Sachs and Ford quickly decried the travel order when it was issued. They said it hurts their workers and prevents the companies from attracting top talent to stay competitive.

Immigration attorney Corina Farias said: "The practical implications are simply that you've got foreign nationals that are frightened and really afraid about what is going to happen when they enter the United States. This is not only a fear that exists among individuals that are citizens of those seven countries or that have visited those seven countries, but this is a fear that exists basically for everyone traveling internationally."

Protests against the travel ban erupted in many European capitals in support of immigrants. Britain's Parliament was forced to hold a debate on scrapping an upcoming state visit by President Trump after a national petition was launched.

With the President set to unveil a new travel ban sometime this week, potential tourists will be watching.

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