The smell of funnel cake and the sound of roller coaster screams used to signal the promise of carefree summer fun. These days, though, the amusement park industry carries a much heavier weight behind those bright ticket booths and spinning Ferris wheels. Dollywood’s parent company, Herschend Family Entertainment, recently made headlines with moves that left industry watchers stunned.
The permanent closure of two venerable amusement parks in the Atlanta area by Dollywood marks a dramatic change in the $5 billion family entertainment industry in the United States. What’s happening isn’t just about one park making tough decisions. It’s a reflection of deeper cracks spreading across the entire amusement industry, revealing systemic problems that have been building for years.
Mounting Labor Costs and Supply Chain Nightmares
The sector has seen a nationwide labor increase of 18% since 2023, while ongoing supply chain pressures have caused materials inflation to reach 25%. These aren’t just numbers on a spreadsheet somewhere. They represent real financial strain that smaller regional parks simply can’t absorb anymore. In Dollywood alone, for example, around 10% of all of the employees at the theme park are international students.
The situation grew even more complex in 2025. More than 700 H-2B visas have been denied or withdrawn, with zero denied or withdrawn in 2022, and 486 out of 491 approved. Imagine running a theme park that depends on seasonal workers only to discover the government bureaucracy has left you scrambling with no backup plan. Kelly Johnson, whose family runs restaurants near Dollywood, including Mama’s Farmhouse and Alamo Steakhouse, told the Knox News they’ve paid thousands of dollars for visas “that we cannot get back from no fault of ours.”
The Billion-Dollar Gamble That Backfired
Herschend did not disclose how much it paid for Palace Entertainment, but Bloomberg reported that the theme park company took out a $1.1 billion loan right around the same time as the acquisition. Let’s be real here. Taking on that kind of debt in an already unstable market takes serious courage or desperation.
Just last week, Herschend announced that Malibu Norcross in Gwinnett County, Georgia, just outside of Atlanta, will close its doors after more than 20 years in business, and with the sale of three properties and the closure of a fourth, Herschend has already rid itself of 20 percent of the properties it acquired from Palace Entertainment in March. The math doesn’t lie. When you’re jettisoning a fifth of what you just bought, something went seriously wrong with the plan.
Safety Violations and Regulatory Scrutiny
Dollywood was fined after a worker was seriously injured on its river rapids ride, with a state investigation revealing two safety violations. March 2025 incident wasn’t some minor scrape. As he went to hand a tool to another employee, his jacket got caught in a coupling and entangled his left arm, and the employee was airlifted out of the park and hospitalized.
The pulleys involved were not properly guarded, and shaft couplings exposed employees to hazardous moving parts, including bolts and rotating surfaces, with workers required to operate within a foot of these components. Tennessee’s Occupational Safety and Health Administration slapped Dollywood with a fine of only $6,400, which frankly seems like pocket change for safety violations that sent someone to the hospital via helicopter. Still, it adds to mounting operational headaches and raises serious questions about what else might be lurking behind the scenes.
Weather Disasters and Operational Chaos
Flash flooding injured one guest and left others wading through water to retrieve their cars. Mother Nature has not been kind to Dollywood lately. Despite being named the top theme park in the United States in Tripadvisor’s 2024 Travelers’ Choice Best of the Best Awards, Dollywood faced significant challenges throughout the year with unexpected closures disrupting operations on multiple occasions.
You can maintain the prettiest grounds and the fastest roller coasters in the world, yet a single water main break or flash flood can shut everything down instantly. In September, Hurricane Helene caused further disruptions, and freezing temperatures in December once again shuttered the park early. These aren’t isolated incidents anymore. They’re becoming the new normal, and insurance companies are taking notice of the increased risk.
Industry-Wide Revenue Collapse and Visitor Decline
Theme park operators in the U.S. have seen a drop in revenue, with Disney, Universal and Six Flags all reporting lower second-quarter earnings for their theme parks this year. Even the giants are feeling the pain, so smaller operations like regional parks under Dollywood’s umbrella face existential threats. Revenue dropped more than 10% at Universal’s theme parks during the second quarter of 2024, compared with the same period one year ago, down 10.6% from the same period in 2023.
Families stretched thin by inflation are making tough choices about entertainment spending. The average cost of a Walt Disney World vacation – for a family of four over four days – has gone up nearly $1,000 since 2019. Theme parks have priced themselves into a corner while simultaneously facing competition from cruises and international travel. People still want fun, they’re just choosing different kinds of it.
What started as Dollywood facing financial pressure has morphed into something much bigger. The entire amusement park model, built on high fixed costs and seasonal revenue, is being tested like never before. Some parks will adapt and survive, others won’t make it to the next decade. Did you expect the industry behind childhood memories to be teetering on such shaky ground?
