Working for a billionaire has benefits on Lanai during pandemic

Life on Lanai has always been unique, and it is especially so during the new coronavirus pandemic.

To date, there hasn’t been a single confirmed case of COVID-19 on Lanai, which is comforting to residents on Hawaii’s sixth-largest island.

Yet something else perhaps more unusual also is happening on the island: Relatively few workers have had to seek state unemployment benefits despite the sidelining of tourism that is still Lanai’s main economic engine.

Pulama Lanai, the company managing 98% of the island owned by billionaire Larry Ellison, has been paying all its employees even as the two luxury resorts it owns along with the more quaint 11-room Hotel Lanai were shut down earlier this year due to the pandemic.

Some of Pulama’s employees are essential workers and have not had their work sidelined, including water utility operations and grocery store Richard’s Market. But the two hotels are the largest job base on the island.

Pulama has about 1,250 workers, representing the vast majority of Lanai’s workforce and over a third of the entire population on the island of roughly 3,000 people.

Maui County Mayor Mike Victorino touched on the benefit of working for Ellison during a coronavirus briefing in April.

“Lanai is really, really, really fortunate,” he said. “I think there’s some, really, mahalos that need to go to Larry. Yes, he’s a billionaire, but he’s given his kindness to the people who have helped him all these years on the island of Lanai.”

At the time of Victorino’s comments, Pulama was looking at continuing full pay and benefits until May 1. The coverage has continued since then.

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“That’s really an amazing gift of generosity,” said photographer and longtime Lanai resident Robin Kaye.

Not everyone on the island works for Pulama. There are some businesses among small independent retailers, restaurants, tour operators, transportation service providers and other companies that have not been able to sustain all their workers.

Still, more pay in the pockets of Pulama workers benefits other businesses on the island, and the overall result has been an unemployment rate on Lanai that is close to what economists consider full employment.

Lanai’s unemployment rate in June was 3.1%. That compared with 1.1% a year earlier, but the figure was dramatically lower than every other island tracked by the state Department of Labor and Industrial Relations.

Maui had the highest unemployment rate in June at 23.4%, followed by 20.2% on Kauai and 13.7% on Hawaii island. Oahu’s rate was 12.5%. The rate on Molokai was 9.3%, or triple that of Lanai.

Statewide, dozens of hotels have furloughed thousands of workers, while many also were paid for about two months through forgivable federal Paycheck Protection Program loans.

Last year, Lanai’s civilian workforce averaged 1,300 people, and the unemployment rate was 2.1%, which represented 27 people unemployed, according to the Labor Department.

Ellison is the co-founder of software firm Oracle Corp. and bought 98% of Lanai in 2012 for a reported $300 million. He has a net worth pegged by Forbes at $72 billion, making him the fifth-richest person in the world.

Pulama in the past has made other efforts to keep its workers from being unemployed.

Five years ago, when Ellison closed the former Lodge at Koele and Manele Bay Hotel as part of a $150 million plan to transform the properties into more luxurious attractions now known as Sensei Lanai and the Four Seasons Resort Lanai, Pulama redeployed resort workers into other jobs that included natural resource restoration, historic and cultural site preservation, public school support and even home improvement projects for seniors.

Both hotels, along with Hotel Lanai, closed in March after the state restricted travel. They reopened July 1, with kamaaina rates starting at $784 per night at the Manele hotel and $650 per night at Sensei Lanai with transportation from Honolulu on Lanai Air included.

The hotels anticipate reopening for out-of-state guests Sept. 1, though that date is tentative and subject to state approval that appears questionable given the rate of new COVID-19 cases outside Hawaii. On top of that, Victorino has recently suggested that a 14-day quarantine be reinstituted for interisland travel because of a surge of cases on Oahu.