Feast or Famine returns to the discussion table with the question of whether Hawaii will be facing too many or too few visitors. As all the talk turns from Covid to possible recession, here’s how Hawaii travel may look due to an upcoming economic slowdown.
It’s a weird world these days. We’re either obessed with one thing, or with another thing. There seems to be very little time in between. Whew, does anyone else need a break from the intensity here or is it just us?
Visitors and residents sound-off on Hawaii tourism: not enough or too much.
Domestic visitor arrivals in Hawaii are still at record numbers as summer starts in earnest today. But will that trend continue, or are we about to see another huge change, at which point the entire conversation may turn on a dime.
The last albeit brief recession in Hawaii was 2020-2021, when the unemployment rate went to 8% and there were no visitors to speak of. In fact arrivals dropped to just 5% of what they are today during Covid.
Looking back further, the 2007–2009 recession caused a loss of at least $3 billion here in Hawaii, mostly due to the huge reduction in visitors. That was a time when we had the islands all to ourselves, much like with Covid. We won’t soon forget being on normally crowded beaches and seeing no one. The impact was so severe in our state, which relies predominantly on just one industry, tourism.
Signs that visit numbers and travel costs may be about to self-correct?
We said yesterday that car rental prices are dropping. No joke. And that’s really just the start. The hundreds of comments about the ridiculous prices of car rentals in Hawaii may soon come to an end. Hotel rates are slowly starting to decline as well, and we anticipate no less than a 25% reduction in Hawaii accommodation rates over the next sixty days.
If we learned anything from the recession of 2007–2009, visitors stopped coming, hotel occupancy sank and room rates dropped. Given how much Hawaii hotel prices have jumped, that’d be a welcome relief.
There are more signs that this kind of change may be on the horizon.
Hawaii tourism remains vulnerable to huge swings.
With our lack of economic diversification, Hawaii can experience rapid economic change. That’s because a significant decline in Hawaii tourism and visitor spending is possible, and perhaps even imminent. Looking back at 2007–2009, you’ll recall that was also when Aloha Airlines and ATA Airways went out of business, NCL ended two of its three weekly Hawaii cruises permanently, and some Hawaii hotels ran out of money to pay their mortgages.
What would an about-face regarding Hawaii overtourism look like?
Hawaii remains reliant on tourism exactly as was the case before the 2007–2009 recession. It took until 2012 for visitor numbers to return to pre-recession levels. Visitor spending dropped precipitously, too, from which is has largely never recovered.
The state has estimated that if an upcoming recession were of the same severity as the 2007–2009 one, visitor arrivals would be close to 1.5 million per year less, with up to 11 million fewer total visitor days and close to $4 billion in less annual visitor money.
We welcome your comments.
As I stated in a previous post credit card debt is climbing at an alarming rate. American credit card buying power will max out in 6 to 9 months.
By the way check your mail I’ve noticed a considerable increase of zero interest credit card offers and without requesting 2 I’ve my credit card limits were just raised.
Back in April I booked travel to Oahu for October if I book same resort stays today the price has more than doubled.
Have not found a drop of rental car prices on Costco yet.
I think balance needs to be achieved in our state, politicians don’t seem to understand the word “balance” the pendulum seems to always swing too far one way or the other. I hope that at some point they will see a way to self sustainability and welcome visitors in a measure and happy way that is good for all.
At the risk of opening another can of worms, I wonder how many people are aware of the entrance and parking fees being assessed to non-resident Hawaii visitors at Koke’e State Park and Waimea Canyon. We’ve enjoyed visiting these areas every year for the past 12 years, but no more. The cost is insignificant, but the attitude of the tourism bureau is detrimental. No more visits.
I totally agree with you. If they want to charge fees, they should add educational signs & information. We don’t have that discrimination on the mainland attractions
Last time I went to Mt Hood Oregon I had to pay for a parking pass, same with Yellowstone…the list goes on but you get the point. Hawaii needs to manage it’s resources now or they will disappear. Again, a lot of people not from here trying to tell us how to run the State to best cater to them. Hawaii needs to protect it’s future and the tourism that is best for Hawaii will follow. Hint, it’s not mass marketing and making it as cheap as possible for as many people as we can possibly shoehorn into here.
The core come-away here is the dangerous lack economic diversity in Hawaii today… and that’s largely due to legislative mismanagement and lack of leadership, planning, or vision–from the top down. Certainly Hawaii’s core asset is its natural beauty–and the preservation and enhancement of that should absolutely be at the center of any master plan for Hawaiian economic development and sustainability. But close behind that should be self-sustainability and weaning the state and county economies OFF of such a dangerous reliance on tourism–both for jobs and for tax dollars. That money is like a drug… and the government needs to get clean and sober.
Jared X,
What would realistically replace a significant chunk of tourism?
The mainland is over 2,000 miles, Japan 4,000, China 5,000.
I think the issue is how to sell tourism while maintaining the distinctiveness of Hawaii. I think in the long term there is no way for Hawaii to move away from significant tourism. So, learn how to better capitalize on it, while being a welcoming destination. It’s up to Hawaii to figure it all out – with outside help from real tourism experts.
Outside help from “real” tourism experts Rod? So Hawaii can become like where? Las Vegas? Orlando? So many comments on here by “outsiders” telling us they think Hawaii should cater to them…..We don’t want our neighborhoods turned into tourist havens and our street parking lined with Turo’s. Hawaii needs to take care of Hawaii and find a sustainable future balance. Clearly that sure won’t be done by people from the mainland.
John,
I’m no “outsider.”
First trip 1965, most recent trip 2021. Next trip, this September.
And, like you and most other residents of Hawaii, I’m an American and entitled to my opinion.
Experts can HELP plan Hawaii’s future just as they Help plan in other states. Hawaii is not exempt from common sense, although some seem to think it’s not a part of the USA.
What if Vegas (you know the 9th island) decided to limit Hawaiian residents or charge them extra? You’d hear cries like nothing you’ve ever heard in your life!! LOL..
The summer vacations have probably already been booked. But you’re correct that because if jet fuel prices and inflation, I see it hitting Hawaii hard in September and October. But what a double edged sword. Ige was telling people to stay away, now too many people, then hey please come we need you. What a roller coaster. Either way, I want to read about solutions. Plan for it.
I don’t get it. “Everyone” is so happy when the tourists stay away (for whatever reason) but then complain about the hit to the economy an unemployment. Who Are these happy and sad individuals?
You are essentially talking about two different groups of people–not the same group. The “locals”–particularly the unemployed / state-supported locals–that don’t own tourist-dependent businesses and generally don’t work at all–or work at government jobs–are the ones that are anti-tourism / pro-COVID restrictions. Their incomes and lifestyles are tourism-proof and they’re happy to have their island(s) all to themselves–and rightly so. And it’s “the State”–i.e. the government (state and county)–as well as multi-national chains (hotels, rental cars, fast food, etc)–and other tourist-dependent business owners that want a full recovery of “normal” tourism as quickly and painlessly as possible. You can never make both groups happy.
@Jared X – The state and county governments do *not* want tourism to return. They are actively working on bills and resolutions that have the sole purpose of reducing tourism. Please listen to the last 2 Maui Planning and Sustained Land Use committee meetings. The videos are available under the County of Maui website, under Agendas.
PATG you’re wrong, government is putting up a “front” to get votes, do you really think the hotels are not in their pockets? The Hiltons are building a huge complex on Maui (right now) and were able to put a restaurant On the Beach, its being built right now, now one else can build anything on the beach! how’d that happen? The Billions the state spent on the rail is ridiculous, also voted down by the people, yet it was built anyway.. who was padding those government buddies pockets? The rail wasn’t built by residents.. The good old days of a “go fund me” was getting a job not a website.
– The council have put a moratorium on building transient vacation rentals, including hotels. There is a cap now, and no more can be built. Any hotels that you see being built were already in the pipeline and approved before the caps were set. This will result in a loss of tax revenue for the state and Maui County.
– The council is now trying to allow condominium complexes to decrease their taxes by declaring that they forbid short-term rentals, even though they are on the Minatoya list. The Minatoya list is a list of condo complexes in Apartment district that have historically been allowed to do short-term rentals. This will result in a loss of tax revenue for the state and Maui County.
You know that the council members don’t care about who they hurt, they’re only in it for voters.. people don’t pay attention to who they vote for.
– I have been to many, many council meetings, and it is crystal clear and unanimous that the desire is to reduce tourism. The council has pretty much given up on the idea of hoping that resort units get transformed into affordable housing, since that is a ludicrous idea. The resort units would be unaffordable by definition. All it would accomplish is having empty units for most of the year, and a large loss of tax revenue, since short-term rentals pay 4 times the rent of non-owner-occupied residences.
None of this suggests that hotels have the council in its pocket, or that council concerns are for voting purposes only and aren’t genuine. The council is feeling the pain of overtourism along with everyone else.
Hi Pat G, the simple fact that anyone with a brain thought that shows the disconnect and why things are such a mess. Is this Their Reasoning for not Requiring them to Build a defined amount of Affordable Housing? It certainly has a Familiar Scapegoat Smell. More to this, Sunshine Law Violations at Best, Official Oppression, Collusion etc at worst? Imagine all of the Help that was simply passed up by Officials for nothing at all but Stupidity, Really?
Hawaiian Homeland properties charge their occupants $1 a year, that $1 a year will not support anything, last I checked our police don’t work for $1 even an hour.. so someone’s tax dollars are supporting everything here.
It’s their land, always was. The purpose of Hawaii Homelands is to reconnect Kanaka to their ancestral lands, not to make money.
It takes money… to fund all the things you enjoy, parks, roads, police dept. stores, gas stations etc… maybe defund the police is something you prefer, they’re not going to work for free
I truly believe in the program and process but didn’t realize that it was as extremely lengthy and slow as it is. Apply for your newborn, by the time it’s in College they may have something available? I’m neither Hawaiian nor a Resident, I’m just pointing out the obvious of the situation. When I first heard of this, decades ago, there was a few years wait at the Most, up to 3. Now that 1 or more are true, more applicants, less land, bureaucracy, or even unknown delays, the wait time is very long. I can only Pray 🙏 and Hope that this process, and problem, can be expediently solved for those waiting. With ownership comes Pride and Amazing Benefits, even on Leased Land.
I hope some of these prices drop. Pre pandemic our go to hotel was pricy enough with rooms from $350-500 night depending on occupancy etc. Today, have not seen a room under $1000++ in the past year and a half. Last summer we rented on that resorts property a house and now this year the same property has gone up $400/ night! Really a turn off to one of my favorite places that I have been coming to since the early 1970’s so I think a correction is due. I understand prices help limit tourists and that is a good thing in the islands, overcrowding is not good for locals and tourists alike even if everyone is respectful of the culture and beauty. If a correction occurs, for me that will mean am extra trip or a longer stay. Aloha
In a recession – especially if one is on a fixed income – one cannot afford to be gouged every where you turn. Hotel, airfare, restaurants, car rental, excursions, etc. When choices must be made between the gas pump at home, food and other necessities at home (even utilities are UP) then one must rethink vacations – even in Paradise. We have the miles, so we can get there. But do we really Want to spend more and more and More on everything else? Difficult choices. Hawaii, like all other vacation destinations, will have to rethink their priorities as well. Our “Hawaiian Vacation” may be just our memories. That is sad. But everyone must make reasonably intelligent decisions an Prioritize. And we do believe ‘hard times are a comin’……. :0/
Oh how we remember the ’70s, ’80s, 2008, and Now, here we go again! Hang on!
Hi Colleen.
We’re with you. Thanks for your 333 comments to date!
Aloha. .
Those of us mainlanders that love Hawaii and it’s people are thsnkful for all HI residents that the HI economy seek to be normalizing somewhat.
As to the Governor’s handling or mishandling of the tourist economy – given the benefit of the doubt that decisions were made in good faith – the age-old advice still applies ——- to be careful what you wish for. Jim E
We all are feeling the Inflation Grab,what previously was known as the “pinch,” but this time it’s not a nickel or dime or even a quarter, we’re talking lots of Dollars. What concerns me is when Inflation comes at us Full Steal Ahead, how are people going to survive? Making Prudent Decisions now may be what allows us to barely get through the Winter, what lays beyond that will have to wait until then. I feel like every one of us has a number and somewhere someone is keeping score waiting to punch our ticket. Never have felt like this before, ever!
Everybody told Haoles to Go Home. We are about to get our wish. Good job! Time to celebrate!
For selfish reasons I would say hallelujah 😂
Would enjoy my daily beach walks a little less crowded but don’t wish for a repeat full blown recession. Balance just balance
Hi Chris.
That was our point, exactly. Where’s balance to be found anywhere?
Aloha.
Yes, balance please! We have been visiting Hawaii every year or two (as budget permits) since 2005 because we fell in love with the people, culture of Aloha & beauty of the Islands. We are honored to be welcomed there, and try our best to practice mālama/kuleana. We support local businesses almost exclusively (we have had to make a late night run to Longs Drugs occasionally, so it’s not 100%). My husband is a diver and participates in reef cleanup every time we are on Maui. We are not wealthy but just working stiffs that save up to come over to the place we consider heaven on earth. We understand history/why tourists will never be completely welcome, but we hope to be able to visit going forward. We abhor rude tourists too.
We are in the midst of a nine day visit at Poipu. Gas is less here than in California. We prepare breakfast and dinner in our rented condo. Lunch is enjoyed as an outing where the prices are about the same as we saw a few years ago when we were here. I booked our car through National at about the same price as a few years ago. We have been treated very well by the locals. All in all do your homework, plan way ahead, look for deals. Treat the locals well and with respect. Obey the speed limits. Keep your spoiled children under control. Tip generously. We’ll be back to kaanipali next February to watch the whales. I love it here.