Fewer Australians are heading to the United States. Short-term trips to the US have dropped by double digits even as overseas travel keeps rising, according to the latest data from the Australian Bureau of Statistics (ABS). Travellers are still packing their bags, favouring shorter, better-value getaways over the long-haul journeys that once defined Australian travel.
Indonesia has overtaken New Zealand as Australia’s top overseas destination for the first time. The UK has also climbed the ranks, while the US has slipped down the list. It marks a significant reshuffle in the post-pandemic travel recovery, and agents are already feeling the shift.
Indonesia leads the pack
In the year ending June 2025, Australians made more than 1.7 million short-term trips to Indonesia. Nearly nine in ten were holidays. It is the first time the country has claimed the top spot in ABS records.
New Zealand followed closely, buoyed by demand for family visits and weekend breaks. The UK also recorded higher volumes, supported by airline capacity and pent-up demand for longer-haul travel.
US travel continues to cool
The number of Australians returning from the US fell compared with 2023-24. The United States remained in the top five destinations overall, but its share of outbound travel is shrinking.
Several factors are weighing on demand. Exchange rates and high on-the-ground costs are stretching budgets. The distance and cost of internal airfares are discouraging short-term travel. Some agents say their US bookings are steady but not growing, while clients are choosing to invest in more frequent short-haul holidays instead.
American tourism faces wider challenges
The US travel industry is facing headwinds of its own. According to the US Travel Association, the ongoing federal government shutdown is costing the nation’s travel economy at least USD 1 billion each week.
“Travellers are facing longer TSA lines and flight delays. Airports are reducing flights and we’ve seen entire control towers go dark,” said US Travel Association President and CEO Geoff Freeman.
Even before the shutdown, the US was the only major economy forecast to lose international visitor spending in 2025, with the World Travel & Tourism Council projecting a USD 12.5 billion decline. These pressures could affect airline schedules, inbound marketing, and the overall travel experience.
Outbound travel recovery continues
Despite the US slowdown, Australians are travelling overseas in near-record numbers. ABS figures show resident returns reached 98 per cent of pre-pandemic levels in 2024-25. Some months even exceeded 2019 volumes.
Short-haul destinations continue to dominate the recovery. Travellers are drawn to affordability, accessibility and the ability to travel more often. For many, proximity is proving more powerful than novelty.
What agents need to know
For the trade, the data highlights where opportunity lies next. Agents can expect:
- Stronger demand for Asia-Pacific itineraries
- Growth in repeat short-haul bookings
- Pressure on pricing for US packages
- More interest in value-driven, multi-stop trips
Airlines are likely to adjust capacity toward high-performing routes, creating sharper competition for fares and inventory. Agents tracking these shifts can act early to secure availability and build relevant offers.
Australian travellers are still exploring the world in large numbers. Their destination choices are evolving with the market. For agents, staying close to client behaviour and market data will be key to capturing the next wave of demand.
KARRYON UNPACKS: Australians are cooling on the US while Indonesia, New Zealand and the UK climb higher. Agents who pivot toward the fastest-growing markets will find stronger sales and more resilient demand through 2025.
