A drop in visitor arrivals to Hawaii from the spread of the delta variant and COVID-19 containment measures is creating a new round of tourism sector layoffs, furloughs and reduced hours just as federal unemployment aid is ending.
Hawaii got a small spike in travelers for the Labor Day holiday, but not nearly as many as were expected before Gov. David Ige asked visitors not to come to Hawaii through October. Since that announcement, travel here has plummeted.
And it’s only expected to get worse next week when Honolulu Mayor Rick Blangiardi’s Safe Access O‘ahu kicks in and Maui Mayor Mike Victorino institutes a health pass. Both programs will make it more difficult for unvaccinated visitors who come to Hawaii on a pre-test exemption to patronize certain businesses.
The slowdown is welcome news for residents who are worried that the state’s health care resources aren’t adequate to handle surging COVID-19 cases. However, it couldn’t have come at a worse time for Hawaii’s economy.
Two programs — one that provides jobless aid to self-employed and gig workers, the other to people who’ve been unemployed for more than six months — are expiring today.
An additional 2.1 million people nationwide will lose a $300-a-week federal supplemental unemployment payment, which also expires today. These recipients will, however, continue to receive state unemployment benefits.
Bryant de Venecia, a spokesman for Unite Here Local 5, the union that represents workers at Hilton Hawaiian Village, said the property has laid off 25 maintenance workers and put 150 of its 600 housekeepers back to on-call status.
De Venecia said about 68% of the 9,000 hotel workers statewide whom Local 5 represented before the pandemic had returned to work by last week. But a lot has changed since Ige asked for a tourism slowdown.
De Venecia said at least one other big hotel employer is telling union members that post-Labor Day occupancy is expected to dip below 60%. That’s got the union bracing for the possibility that more of its workforce will experience reduced hours or additional layoffs and furloughs.
“We are seeing cancellations, for example, and this is also the time when the peak season is done, so the occupancy is not there,” de Venecia said. “It’s a very tough time for our members. They are facing the same furloughs and other issues but without the safety nets.”
The cutoff in unemployment checks will abruptly erase a vital source of income for many Hawaii residents.
Mary Taboniar went 15 months without a paycheck, thanks to the COVID-19 pandemic. A housekeeper at the Hilton Hawaiian Village resort, the single mother of two saw her income completely vanish as the virus devastated the hospitality industry.
For more than a year, Taboniar depended entirely on boosted unemployment benefits and a network of local food banks to feed her family. Even this summer as the vaccine rollout took hold and tourists began to travel again, her work was slow to return, peaking at 11 days in August — about half her pre-pandemic workload.
Taboniar is one of millions of Americans for whom Labor Day 2021 represents a perilous crossroads. Starting today, an estimated 8.9 million people will lose all benefits. A federal eviction moratorium already has expired.
For Taboniar, 43, that means her unemployment benefits will completely disappear — even as her work hours vanish again.
“It’s really scaring me,” she said. “How can I pay rent if I don’t have unemployment and my job isn’t back?”
She plans to apply for the newly expanded SNAP assistance program, better known as food stamps, but doubts that will be enough to make up the difference. “I’m just grasping for anything,” she said.
President Joe Biden’s administration believes the U.S. economy is strong enough not to be rattled by evictions or the drop in unemployment benefits. Officials maintain that other elements of the safety net, like the Child Tax Credit and the SNAP program (which Biden permanently boosted earlier this summer) are enough to smooth things over. On Friday a White House spokesperson said there were no plans to reevaluate the end of the unemployment benefits.
Hawaii’s tourism industry also is operating without a safety net. The Washington, D.C.-based American Hotel and Lodging Association estimates that government-issued travel bans and restrictions have wiped out 10 years of job growth. AHLA continues to push for targeted relief for the industry, which so far has not received direct coronavirus-related aid.
Keith Vieira, principal of KV & Associates, Hospitality Consulting, said it’s likely that more job cuts are in store for Hawaii.
“Three Hawaii wholesalers told me that they’ve seen the highest Hawaii cancellation rate ever in their history over the last five days,” Vieira said. “There’s not any positive trend right now at all.”
Toni Marie Davis, executive director of the Activities & Attractions Association of Hawaii, said she’s taken call after cancellation call since Ige’s announcement, and members are reporting significant losses.
“The activities and attractions throughout the state are seeing more cancellations than bookings,” Davis said. “Immediate business has died.”
Davis said one of her boat operator members told her that their scheduled trips have plunged by more than 50% since Ige asked for a pause.
“They are probably going to do layoffs,” she said. “I’ve heard from small mom-and-pops that are experiencing six-figure losses.”
Jerry Gibson, president of the Hawaii Hotel Alliance, said the group met with Ige on Friday to pledge its support and to convey where the industry stands.
“I believe in Hawaii, and with everybody’s help and efforts, we’ll get right back on the horse and start riding it,” Gibson said. “We need to do a good job for the economy and for the residents here that have jobs and obviously need to provide for their families.”
Gibson said Hawaii hotels are experiencing drops in business related to the surge of the COVID-19 delta variant and Ige’s request for a travel pause, which have compounded seasonal softness.
“We’re about 25% to 35% down on top of seasonality,” he said. “It’s possible, with the percentage drops that I’ve described, that there possibly could be some people that aren’t working full time. We’ll be staffing to the business.”
Gibson said the lack of group, cruise ship and international business also is impeding recovery for Hawaii’s hotel sector.
Duke Ah Moo, Hilton vice president and commercial director for Hawaii and French Polynesia, said, “We are all seeing the impact at our properties resulting from the spike in COVID cases and with the governor urging against all nonessential travel through October.”
“We’re committed to working with the visitor industry and Hawaii’s community to address this current crisis and keep our community and visitors safe,” Ah Moo said.
The Associated Press contributed to this report.