US Accommodation and Food Services Sector NAICS 72

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Industry Summary
The 771,900 establishments in the US accommodation and food services sector prepare meals, snacks, and beverages to customer order for immediate consumption or provide short-term lodging for travelers and vacationers.
Economic Sensitivity
The accommodation and food service sector is driven by discretionary spending and is vulnerable to economic downturns.
Labor Intensive, High Turnover
Food service and accommodation operations are labor-intensive, and the sector struggles with turnover.
Recent Developments
Sep 13, 2025 - Psychological Barriers to AI Adoption
- Artificial Intelligence is transforming hospitality, with AI-powered robots supporting services, smart technologies enhancing operational efficiency, and predictive analytics forecasting demand, according to Hospitality Net. But while AI’s technological capabilities continue to expand, ultimately its success will depend on how it’s perceived and experienced by guests and employees, HN warns. Indeed, barriers to AI adoption in hospitality are less about trust in its technical capability and more about psychology, with people judging AI not only on what it does, but also on how it makes them feel. Understanding the psychological responses of guests and employees is important as they affect people’s willingness to accept and engage with the technology, according to HN. To deploy AI successfully, hospitality leaders should “humanize” the AI interface by mixing AI and human touchpoints to counteract its perceived lack of empathy and ensure it empowers rather than controls interactions, per HN.
- Consumer confidence fell sharply in June, according to the Conference Board’s Consumer Confidence Index, which declined by 5.4 points in June to 93, giving up much of May’s gains. Meanwhile, the CB’s Expectations Index fell to 69.0, remaining below the recession-signaling threshold of 80. Declines in confidence were observed across all age, income, and political groups, according to the June report. While consumers’ spending plans showed mixed signals, service sector intentions weakened broadly, with dining out being an exception. Despite the recent slip in consumer confidence, travelers are still planning trips and hotel stays this summer, Hotel Dive reports citing a Bank of America’s Summer Travel Trends Survey, which found 70% of respondents said they plan on vacationing this summer – a 3% increase from 2024. While more Americans may travel this summer, they’ll do so on tighter budgets, according to the Deloitte 2025 Summer Travel Survey.
- International travel to the US is trending downward, according to preliminary data from the Department of Commerce, US Customs and Border Protection, and other organizations that track inbound US travel. Total international visits to the US fell approximately 14% in March compared to the same period last year. Moreover, traffic from the highest-value inbound travel markets declined significantly. March saw a 26% year-over-year decline in overnight land trips by Canadians and air travel to the US from Canada fell 14% YoY. Travel from Western Europe declined for the first time since 2021, with a 17% drop in March visits to America. Travel from Asia fell for the second consecutive month in March and remains 25% below 2019 levels, while visits from South America fell 10% following a flat February. Florida was the top destination for international visitors in March, per the US Travel Association.
- Accommodation & Food Services was one of four of the 16 industries tracked by the Institute for Supply Management’s Services Purchasing Managers’ Index (PMI) that reported contraction in August due to a decline in business activity and the impact of tariffs. Producer prices for accommodations fell nearly 1% in August compared to a year ago after rising 2% in the previous August-versus-August annual comparison, according to the latest US Bureau of Labor Statistics data. Employment by accommodation and food services grew 0.9% year over year in August, down slightly from its high in June, while sector wages increased 3.4% YoY in July to $19.54 per hour, BLS data show. Rising payrolls are a pain point for the sector, which must contend with rising minimum wages in many US states and competition for workers.
Industry Revenue
US Accommodation and Food Services Sector

Industry Structure
Industry size & Structure
The accommodation and food services sector comprises 771,900 establishments that employ 14.2 million workers and generate $1.3 trillion in annual revenue, according to government sources.
- The accommodation and food services sector represents 3.3% of the nation's Gross Domestic Product (GDP) and employs about 9% of the country's workers.
- The sector is fragmented with the 20 largest firms representing 13.3% of revenue.
- In addition to employer establishments, the accommodation and food services sector has 491,800 owner-operated establishments with no employees. The subsectors with the highest number of nonemployer establishments are special food services (56%), restaurants and other eating places (23%), and traveler accommodation (11%). The owners of nonemployer firms typically perform the work and may outsource support functions like marketing and accounting.
- The US Accommodation and Food Services sector shed nearly 20% of its employees in 2020 due to the pandemic but recovered to surpass 2019 levels in 2024, according to the Bureau of Labor Statistics.
Industry Forecast
Industry Forecast
US Accommodation and Food Services Sector Industry Growth

Source: Vertical IQ and Inforum
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