Hawaii Restaurants Closing

Hawaii Restaurants Are Struggling; 4 More Shutter Entirely

Will more Hawaii restaurants close, move to take-out only, or make other significant changes as problems worsen, and some restaurants simply decide to close down?

Four of Honolulu’s most recognized restaurants, and highly rated ones at that, have closed their doors with little notice. This comes as the Hawaii restaurant industry suffers from many issues, including high costs and a lack of ability to hire and retain staff. Of all these issues, the worst we are told is staff shortages.

The Hawaii restaurant industry remains primarily disrupted.

That comes following the pandemic, and the industry appears unable to recover. There are currently significant staff shortages at most restaurants.

Not only that, but some restaurants are seeking to provide housing for their employees to offset the untenable cost of living they face. Following Covid and the decrease in Hawaii travel, restaurants closed or reduced operating hours. Workers were initially laid off or chose to leave independently.

When Hawaii’s travel economy started recovering, and restaurants reopened, there was a skyrocketing demand for workers. Still, not enough people were qualified or wanted to return to restaurant positions.

While restaurant staffing shortages aren’t uncommon throughout the country,  it is greatly exacerbated in Hawaii because of the higher cost of living. Restaurant workers find it hard to make enough money in their positions to continue to afford to live in Hawaii.

While restaurants have sought to increase worker pay and benefits, that still hasn’t been enough. Many restaurants, cafes, and other establishments now operate on reduced hours, with fewer menu options and tables in use.

Technology, including self-service options and online ordering, is also being used to help restaurants operate with fewer staff. Restaurants are also trying innovative solutions like flexible hours and shorter and longer shift options. We just interewed one restaurant owner who said that it isn’t unusual to have staff work double shifts to make up for shortages. He said that the increased cost of overtime and in trying to hire, train and retain staffing presents a very challenging situation.

Zippy's Restaurant switches to take-out only

Zippy’s Restaurant tries a take-out-only model.

Could this be more of what the future will look like? The Zippy’s restaurant at the Koko Marina Shopping Center called it quits in terms of sit-down dining last week. They have transitioned entirely to being take-out. That is becoming commonplace, unfortunately.

The Hawaii Restaurant Association executive director said regarding Zippy’s, “the rent of that space and the revenue is what they’re looking at on the top of expenses, the employee shortage, and whether they have enough staff to provide excellent customer service.”

Four popular Honolulu restaurants closing suddenly.

Two closures already occurred this week. First was Piggy Smalls at Ward Center which closed after seven years. Their flagship Chinatown restaurant, The Pig & The Lady continues to operate. Next was Little Village Noodle House, a fixture in Chinatown for 22 successful years. Both will be missed.

Ruby Tuesday in Kapolei is scheduled to close on February 21 due to increasing costs and, even more so, unavailability of workers. Also closing  in Hawaii Kai is the Outback Steakhouse. They will serve their last meal on February 26.

While restaurant closures are becoming a regular occurrence, the number announced this week, is unpreceneted.

What we can do to stop more Hawaii restaurants from closing?

One thing is to support local restaurants and tip employees generously. The prior 15-20 percent tip guideline maybe now should be 20-25% given today’s world. What are your ideas?

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70 thoughts on “Hawaii Restaurants Are Struggling; 4 More Shutter Entirely”

  1. So bring on some mainland chains which are thriving everywhere and make some concessions that will draw them to the islands! For starters: in/out burgers, ihop or another applebees (west oahu(?)
    We just lost our only dennys’ @ windward city …(replaced by a mattress store????) and why?? Because it wasn’t always busy….Nooooooo!

  2. Tipping is at an absurd level – 20-25% for a tip? Please, why should the public be responsible for subsidizing a for-profit business that refuses to pay a living wage instead of a slave wage? Or give employees the minimum number of hours to avoid offering health benefits?
    Not to mention that as menu prices rise, so does the amount of the tip, even at 15-20%.

    The food service industry has had it good for decades by taking advantage of their labor force and their patrons, those days – and the obsolete business model that reinforces that mindset are over, that world no longer exists and any business that relies on paying crappy wages and having their labor subsidized by their customers will face the same fate and deservedly so.

  3. Since the pandemic I typically will tip 20 to 25%. On smaller less expensive locations I may tip more. When you look at the dollar amount between 20 or 25 it’s minimal but can add up for the servers.

  4. Personally, I think tipping is out of control, and asking me to tip more for worse service is unfair. Nobody can afford to increase tip rates. Tipping needs to go. These people should earn a guaranteed wage, and customers shouldn’t be asked to subsidize their pay if their bosses don’t want to pay a fair wage. Tipped employees no longer feel gratitude for a tip. They now Expect and Demand a tip, and they shame customers who don’t tip (whether they received good service or not.) I say that as someone who worked in the industry when young. I Never expected a tip. Now, it’s demanded by everyone–whether they work at a tipped wage or not!

  5. Easy, put an automatic 20% gratuity on the bill. You can add more for good service. Don’t return if continued bad service.

    1. A gratuity is meant to show gratitude. I am not going to a restaurant that demands gratitude for its employees before I receive the service. I don’t ask much, but I do expect friendly service and a good attitude. I am certainly not going somewhere that rewards poor service.

  6. Keeping restaurants from closing in Hawaii …. Simply put Restaurant owners first need to increase their wages and benefits of their workers by 25% and then raise their menu prices accordingly… We always tip but many foreign visitors dont tip at all.. you cant expect your customer to make up wage shortages- bad economic model but needed when half your customers dont tip because they will never come back again or their cultural practices dont allow it. Restaurants should initiate a policy of forced tipping at 20-22% to be added to the bill… Its this or the place closes down. This is 100% the result of government inflationary policies and continued inflation will unfortunately eventually close many more tourist related businesses…

    1. Mario everyone has said that Hawaii can survive just fine without tourists, closing down the restaurants, clothing stores, etc. Would be a great place to begin. Imagine endless days of Beach Fun, Tanning, Relaxing to the sounds of the ocean. Maybe it’s really going to happen! Don’t get too excited as I doubt that it will happen.

    2. As I said to someone else, a tip is in gratitude for good service. It is Not something I am going to pay on command. I don’t ask for much, and I tip starting at 20% and go up from there. But I’ll be darned if I am going to have anyone Demand a tip from me. I would just stop going to those places.

      Also, it’s 100% the fault of the local government. Wages in Hawaii are ridiculously low. We now live on the mainland, and hubby got a $65k per year raise for relocating–to a Much less expensive area! We only come to visit now. I miss it, but it’s not sensible to take a pay cut to live in an overpriced economy just to be in Hawaii. It’s harming every Hawaiian citizen who doesn’t have extreme wealth. And it’s why so many don’t want these jobs.

  7. I’m wondering how many chefs, line cooks and servers have Hawaiian food trucks siphoned off from brick and mortar restaurants?

    Just a short ten years ago there were few food trucks on the islands now they are everywhere serving mostly cheaper meals then traditional restaurants.

  8. The suggestion to give 20-25% in tips would be fine, if most of us were not struggling due to the high costs of living in Hawaii.

  9. All You have to do is look at a local government that that smells of collusion & corruption i.e. removing short term rentals and making them mandatory 90 days. What vacation is 90 days long? It gives the hotels free reign to raise their prices and forces its bread and butter tourists to pay up and also removes the short term rental space. Robbing locals of a viable source of income of millions of dollars annually. With more dollars paying for lodging and removing a source of income there is less dollars to spend elsewhere. Combine it with an inefficient government & reduced workforce is there any wonder why there are closures and less tipping? Not to mention local governments attempt to charge a 40% tax on LV packages? Lolo!

    1. You make some good poinst but isnt removing local rentals from the tourist accommodation meant to free up space for locals to have places to rent? If it’s only full of tourists, sure rental owners make more $ but the problem is further exacerbated with less workers able to full the service/restaurant jobs. No place to live = cant work.

      1. Brad it’s doubtful that the amount of vacation rental units will make much of a difference in the problem, sorry to say. If the housing is up for sale how many could afford to purchase? As always there’s more to consider than what people actually are. If people can afford housing why aren’t they Building their own with LTR unit attached to it? Sounds like people can’t afford to live there and are causing problems for those who can. Shameful and Typical.

  10. Just returned home from a sixteen day trip to Maui. We went out to eat a total of six times, and three of those times we split a meal. It’s now a luxury to go out to eat. Also I will not spend 30.00 dollars to park so I can eat in Paia or Lahaina, and that’s to bad because I do enjoy Kimo’s in Lahaina. I don’t think Hawaii is going to get less tourist but they will probably get less tourist dollars as we pick and choose how to spend our money.

    1. I agree. I love Hawaii, and I miss living there because of the wonderful people and beautiful climate, but my hubby got a $65k per year raise when we moved away–to a Much cheaper economy. I also make way more than I would make in Hawaii, and I get nearly two months a year in paid vacation! Now, we can afford to travel frequently, but Hawaii is not at the top of our list anymore. There are so many international locations that are now competing for the tourist dollars that Hawaii used to get because Americans wanted to stay in the U.S. International travel is so easy and affordable now that we travel widely.

      1. I loved the beaches of Ecuador and the Galapagos Islands are not to be missed! Food is cheap, weather is great year round and affordable taxi rides so no car necessary!

        1. Have not been there and my Spanish is limited. However, my ex-husband tried to convince me that there are other places like Hawaii …we went to Bermuda, Bahamas, Cancun, Acapulco, Puerto Rico. Florida, Costa Rica ….all these places were ok for a visit and I wouldn’t mind visiting Costa Rica again. However, it’s not Hawaii, so let’s make sure we preserve these islands and people. I didn’t just move here for the beach and climate (both of which I love), but also for the people and Hawaiian culture, so I hope they don’t get lost ….

  11. The solution is so very easy….food trucks, no high rent and lower tips because it is take out ! and if you want too go to a high-end restaurant pay the price….simple.

  12. I don’t know the answer. But I do remember reading about McDonalds in Denmark and feel that that it relates somehow. Denmark has no minimum wage, so McDonalds entered the country with short shifts, low wages, and a typical US work environment. Strikes soon began, escalating over years, until McDonalds raised to living wages, gave fixed shifts, and gave 6 weeks vacation. Real Jobs. The effect? One percent fewer McDonalds in the country and 18% less profit to the wealthy owners. So, ironically, the solution was slightly fewer restaurants and slightly fewer jobs to get an overall higher standard quality of life for everyone.

    1. Wealthy owners? McDonalds is a publicly traded company. Many small investors and retirees own their stock and others indirectly through pension plans. Food in general in Europe is quite expensive and McDonalds often provides a cheaper, fast and reliable alternative. Also, if one is running a business each location has to be profitable or it should be closed.

      1. Well, I’d hate to suggest that any publicly traded company is justified in paying low wages because they are public, so I think it makes more sense to look at the actual numbers. The New York Times did extensive reporting and found that the profits in Denmark were still quite high for McDonalds, while the quality of life for their workers was made quite high. So, unless the numbers reported by McDonalds were fiction, this is simply a matter of being slightly less greedy at corporate – not forcing senior citizen to beg for food. Somehow, McDonald’s has managed to thrive in Scandinavia – with many reports of prices roughly equivalent to those in the USA.

      2. McDonald’s is a corporation, but it uses a franchise model, wherein individuals own the stores. So, Yes, wealthy owners.

        And good for Denmark for looking out for its employees. Better yet, good for the employees for saying “no” to the garbage way companies operate in the U.S.

  13. Just wondering how much higher rent and other fixed expenses like utilities have gone up since COVID? I would like to point out that people vacationing are complaining about workers who probably are working 2 jobs to make ends meet or struggling to make an honest living. The cost of tourists enjoying lower costs was on the backs of workers in service industries. In other words the cheaper your hotel was depended on how little maids were paid or now you pay more and get fewer services. All this is a win for the corporate earnings and dividends, especially hotels. I have no answers but we are living in more or less post COVID times and the changes are for sure going to continue!

    1. That’s just wrongheaded thinking. Corporations take their profits at the expense of the employees. They choose to pay low wages to maximize Their profit margins. Those hotels are hurting their workers. Period.

  14. Unemployment expired, now on the welfare system. Great gig, collect welfare and sit on the beach in Hawaii. Not saying all people are doing that. But there is no incentive to get a job. Maybe the governor will add another $50.00 tourist charge to help support the restaurant workers. And how is the light rail project coming along? More finger pointing with little or no action.

    1. Mark, despite common sense several have continued the practice of Supplemental Unemployment benefits in conjunction with rent assistance, food, utilities, etc. All of this combined has actually allowed many to live a higher lifestyle than if they were working, even if it were about the same why work! As you point out living in Hawaii on welfare can allow plenty of beach time. Excellent observation!

    2. … And wait till the homeless sit in a rail car all day and half the night. Trash everywhere. What a boongoggle the rail has always been …

  15. We agree and tip 25% or higher. $20.00 doesn’t go very far in Hawaii but if you want to continue to travel there you have to support and help the locals. Just came back from Maui and the hotel staff was not as happy as in past. Restaurants seemed fully staffed and servers were friendly at most places. If you can afford the trip help the locals.

  16. BOH, another wonderful and informative article…Thanks! What do I “think?” Dangerous Question 😳 What I consider to be the Number One cause of businesses failing and others struggling is the employment market. With “low unemployment” it would be expected that the workforce would be filling vacancies, they’re not. The reason is the Millions of Able Bodied Young Workforce that refuses to work. Did the Government forget to mention them? Absolutely! Why not cut-off the money they receive from their States and force them to reenter the workforce? Wouldn’t that be prudent?

  17. Your suggestion of raising tips to 25 % should consider some people don’t tip
    at all! I suggest an automatic 18 % on bill. More at your discretion. As we do when really pleased!
    Remember your article about nickel and diming….20 to 25 % kinda smacks of that.
    Your cheap fares are not attracting the big spenders…part of the problem.
    I make an analogy to underpaid service workers to what Hawaii has done for decades before…underpaid teachers!

    1. I agree. I know some restaurants pay their wait staff minimal wages because they assume they make most of their money in tips. An 18% automatic tip a good idea. I also agree that welfare and unemployment benefits have exacerbated the problem. We just returned from Kauai, where we saw more help wanted signs everywhere and yet we also saw more homeless camps than ever before. 2 Thessalonians 3:10 comes to mind… “If any would not work, neither should he eat”.

    2. I think an automatic tip is a terrible idea. We live here in Hawaii. Reality is, people just don’t want to work. And the ones that do, the quality is terrible. It’s not just in the service industry. But in restaurants, the food quality is mediocre and the service is atrocious. There’s no reason why I should spend my hard earned cash to tip a server that obviously doesn’t wanna be doing their job. I say let the restaurants close, it’s not the publics job to pay the wages of employees when the employers are making a ton of money and cater only to shareholders. The employer should be paying a fair wage and they don’t. Now the chickens are coming home to roost.

    3. Like the auto built in tip like other countries. Keep n mind waiters in many restaurants share tips with cooks, busing people and bartenders.
      Still doesn’t account for the many young people who just dont want to work. I’m 77. I’d have collected garbage before living with my parents as a 20 something. I wanted my independence. Every and any job can be fulfilling. Its simply a mindset. Stop with the whing, put the phone down, find reality, think and visualize the positive.

    4. That’s not a tip. That’s a fee. Why not just raise the prices, get rid of tipping all together, and pay a fair wage? I am not going to pay a tip on demand.

  18. Let em close. As long as the powers in Office are giving out handouts, there is no incentive to work. And, the price gouging doesn’t help. the same room on Waikiki is now Over Double from a few years ago. People are finding alternative ways to spend their travel & recreational dollars.


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