Americans will be tighter with their holiday spending in 2025, according to PwC research. The study finds that total spending will drop by 5%—the first decline since 2020.
However, there is a key finding for the travel industry: Americans will cut spending on gifts, but not on travel and entertainment, where a slight increase of 1% is recorded—a bright exception in an otherwise constrained season.
Who is Traveling – and Why It Matters
Some 44% of Americans plan to travel this holiday season, nearly the same as last year (46%). Millennials and Gen Z show the greatest intent (55% each), while Boomers lag behind (26%). The main reason: visiting family and friends (48%), boosting the Visiting Friends and Relatives trend.
Those not traveling cite mainly practical reasons: nearly half prefer to celebrate at home, while cost remains a barrier for 43% (and for 50% of Gen Z).
Generations with Different Wallets
The picture varies by generation: Gen Z is cutting holiday spending by 23% after last year’s dramatic 37% increase, while Boomers are raising theirs by 5%. Millennials remain almost flat (-1%), while Gen X shows a 2% increase. For travel providers, this suggests better prospects among older generations with greater budget flexibility, and a need for more attractive value-for-money offers for younger consumers.
Artificial Intelligence as a Travel Agent
Up to 76% of Millennials say they are likely to use AI to search for travel. The landscape is shifting: companies that have not adapted their content, pricing, and policies into AI-readable formats risk disappearing from new assistant-first booking channels.
Value Becomes the New Luxury
Although consumers are “trading down” in many purchases, travel remains a priority. With gift spending down 11%, families are investing more in experiences and shared moments. Flexible fares, transparent fees, and meaningful benefits are the new “currency” of trust.
The Short Holiday Window
This year’s late Thanksgiving (November 27) compresses the holiday calendar, which may lead to more concentrated bookings, especially for short trips. Travel organizations will need to adjust availability and cancellation policies and attract last-minute reservations.
The Survey
PwC conducted the survey among 4,000 U.S. consumers between June 26 and July 9, 2025. The sample was balanced by gender, region, and generation—including 1,000 respondents each from Gen Z, Millennials, Gen X, and Baby Boomers.
Conclusion
The 2025 holiday season may be “poorer” in gifts, but travel remains socially and emotionally irreplaceable. Tourism providers that invest in clear value, AI-friendly content, and targeted, generation-specific offers will not just weather the year—they will come out ahead.
