CNBC's Contessa Brewer joins 'Squawk on the Street' to discuss the impact of the government shutdown on the tourism industry.

The ongoing U.S. government shutdown is having a pronounced impact on the tourism industry, with losses nearing $200 million and forecasts suggesting up to $1 billion lost each week the shutdown continues. Non-essential government travel has been canceled, affecting corporate travel and leading to a decline in hotel occupancy, particularly in areas near national parks and major convention destinations.

Confusion persists over which services and attractions remain open, although essential operations like TSA, air traffic control, and passport offices continue. Surveys indicate that a majority of travelers are reconsidering or canceling flights, and analysts note that prior budget cuts have already weakened the sector. The long-term recovery of lost travel revenue remains uncertain, especially for small businesses and independent hotels.

Tourism hit hard by government shutdown: Here's what to know

There's a lot at stake for the travel industry in the wake of the government shutdown. Contessa Brewer is here to explain. In fact, U.S. travel, which represents the travel industry, is keeping this kind of running tally on what the government shutdown costs the industry. And if we take a look at it right now, we can pull it up and see it's just building on itself. We're almost up to $200 million since the government shut down, but their forecast is a billion bucks a week lost for every week that the federal government stays closed. Part of it is just obvious. All non-essential government travel is canceled, even for workers who aren't furloughed. That, of course, has a trickle-down effect on corporate travel. For instance, if a meeting with a government agency is canceled, you don't need to fly to D.C., you don't need to have a hotel or eat in restaurants. And this is high season for some vacation rentals around national parks. Think about Shenandoah, Smoky Mountains, Zion among them. They have about 100 percent occupancy right now. Skift is warning that segment can take a hit along with restaurants, shops and tour operators. And there's widespread confusion over what is open, what's closed. Yesterday, for instance, the Statue of Liberty was open, but the Visitor Center for Congress was closed. TSA and air traffic controllers are working. The passport offices are funded through fees, so they're open. Amtrak is still running for now. But the trepidation over travel may be the reason why 60 percent of those surveyed by Ipsos said they would cancel or avoid flights in a government shutdown. And several analysts I talked to say the damage was largely done by Doge already. Those government budget cuts and firings really took a toll on the government segment for lodging. It was down 11 percent by June this year, according to Calibri Labs. Worst hit, of course, D.C., Hawaii and San Diego. Big convention and conference businesses there, down about 25 percent in those destinations. So how much of this ends up getting picked back up once things reopen? If you had a trip planned to the national parks, do you reschedule it or is it gone? OK, so I talked yesterday to someone who relies on government certification to move projects along and is worried that next week his meeting with a crucial federal agency that's been four months in the planning. It took them four months to get this meeting on the books. If it gets postponed and another four months from that, he says, it's really endangering the delivery for this project. So will travel pick back up afterwards? Yes. But if furloughed workers cancel their vacations or their trips, does that money just get lost forever? Right. Yeah, maybe. I mean, it's this is really like, oh, a wait and see. And remember, travel has been soft anyway. International travel way down this year, especially from Canada. So you have especially these independent hotels, 60 percent of hotels in this nation are small businesses and they're waiting and watching with bated breath. I think your point about the confusion, too, is one well taken. I've heard from several people that are worried saying, oh, I have plans to travel this weekend. I said, well, air traffic control, to your point, TSA, those are essential. They're going to continue to work. But then do you need to give yourself an extra hour because people stop or pull back? I mean, the longer it goes on, the more questions there are about are you going to keep seeing even essential workers showing up if they're not getting paid? That's right. The sick call outs that we've seen during extended shutdowns. Good points.

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