LOS ANGELES — Somewhere between Debbie Reynolds and Jack Benny, the Laitala family of Duluth, Minn., stopped to marvel at the throngs of tourists shuffling among the sidewalk stars of Hollywood Boulevard.

Joel Laitala, a mechanic, focused his camera on a star in the pavement while his wife, Lori, watched costumed characters — Superman, Capt. Jack Sparrow and Homer Simpson — pose for photos with tourists for tips.

Every day, visitors from around the world still flock to the hot sites of Hollywood, the birthplace of America's entertainment industry. But so far this year, crowds are smaller, tourist spending is down and merchants are nervous.

The Laitala family was typical of today's visitors. They were scrimping. They avoided trinket shops, theme parks and expensive eateries. They planned to buy food at a grocery story and spend most of their visit to Los Angeles at the beach or the zoo.

"We are definitely holding back," Lori said, citing the high cost of feeding and entertaining her three boys.

Aided by lower gas prices, cheap airline tickets and bargain lodging deals, tourists continue to flock to see Marilyn Monroe's handprints in front of Grauman's Chinese Theater or Tom Selleck's star on the Hollywood Walk of Fame.

But the slumping economy has taken some of the sparkle off Tinseltown, ranked as one of the most visited tourist destinations in the world. Grauman's Chinese Theater alone attracts about 4 million visitors a year, more than the Empire State Building in New York and the Palace of Versailles in France.

Amid fears of layoffs, foreclosures and failing banks, today's Hollywood visitors are tightfisted when spending on food, tips and souvenirs.

In a January survey, 32 percent of Hollywood merchants said business in 2008 was down significantly or moderately, with restaurants taking the biggest hit, a sales drop of nearly 25 percent, said Hollywood Chamber of Commerce president Leron Gubler.

The pain of such frugal spending has been felt by waiters, tour-bus drivers and souvenir-shop owners, many of whom also saw a tourism dropoff after the 2001 terrorist attacks.

"People still want to come, but they don't want to spend much," said Fred Sapir, manager of Starline Tours, the largest and oldest tour company in Hollywood. Business has dropped by as much as 10 percent since February, he said.

At Mel's Drive-In, an iconic '50s-themed eatery adjacent to the Hollywood History Museum, waiters and busboys were laid off when business dropped suddenly in recent months.

"It used to be a madhouse at night, with lines out the door," restaurant manager Gannon Grace said. "Now it's like this," he said, motioning to a half-empty diner.

Even foreign visitors, who account for about 30 percent of Hollywood's tourism, are cutting back. Jenny and Bob Minns, a retired couple from Norfolk, England, took a tour bus across the United States, finishing in Hollywood. To save money, they planned to skip expensive eateries and pass over the bus tours of celebrity homes. "I can see them better on the telly," Bob Minns said.

Such penny-pinching has resulted in more aggressive tactics by Hollywood tour-bus companies that solicit tourists on Hollywood Boulevard, said Shellee-Ann Kellee. She is an actress and singer who runs All Star Showbiz Tours, near Grauman's Chinese Theater.

Tourists, for their part, are haggling with bus tour operators for lower fares. Kellee has had to oblige, sometimes cutting her fare of $38 almost in half. "They are always trying to get you to go down a little further," she said.

Hollywood businesses have trotted out price cuts and discounts. For example, the Hollywood Wax Museum, the Guinness World Record Museum and Ripley's Believe It or Not! have teamed up to offer a $26.95 pass to visit all three. Starline tours now offers $5 discounts to tourists who buy tickets online.

Now Hollywood is waiting for a happy ending.