Hawaii’s economy is set to diverge into two distinct paths worthy of noting for visitors: a slow and challenging recovery for Maui, contrasted by more steady tourism on the other islands.
While Maui grapples with ongoing housing shortages and a disrupted labor market, Oahu and the other neighbor islands maintain a more robust tourism sector.
For travelers, this means that visiting Maui might offer a different experience, with limited services, fewer options, and potentially higher costs as the island continues its journey of rebuilding and recovery.
Visitor spending and the future of Hawaii tourism.
According to the state’s UHERO, visitor spending in Hawaii is now expected to remain lackluster through the end of the decade, indicating a shift in the travel landscape. This trend could affect the availability and pricing of services for visitors.
As the growth in U.S. travelers continues to slump, we might see fewer promotions and discounts, leading to higher prices, especially during peak seasons. If you’re planning a trip to Hawaii, be prepared for a possible increase in travel expenses and consider seasonality and things like booking early to attain the best rates.
Challenges facing Maui’s recovery and visitor experience.
Maui’s wildfire recovery has been challenging and slow. Residents displaced by the fires have impacted hotel availability, among other things. This may translate into a more limited selection of accommodations, potentially higher prices, and fewer options for travelers.
If Maui is on your travel list, planning ahead is more important than ever, and you might want to explore staying in areas less impacted by the fires.
Hawaii labor market and its impact on tourism.
Hawaii’s labor market is facing clear challenges, with a decline in the overall workforce on visitor-centric Maui and slowing job growth across the state. The state reports that Maui’s labor force has shrunk by about 4,200 workers, resulting in ongoing labor shortages.
Travelers might notice the impact through reduced services, longer wait times or even closures of certain amenities. Elsewhere in the state, job growth has also slowed, which could further strain the tourism sector, potentially affecting visitor experiences across all islands.
Anemic international Hawaii tourism.
The anticipated return of international travelers, mainly from Japan, is not happening as quickly as many had hoped, despite the governor’s repeated efforts to promote Hawaii in Japan as seen in his multiple visits.
Visitor numbers from Japan remain roughly half of their pre-pandemic levels, and this is expected to persist in the near future. This trend means Hawaii’s visitor industry will continue to rely heavily on U.S. travelers.
This slowdown might be an advantage rather than a problem for those looking for a more relaxed travel experience with fewer crowds.
Housing costs and the future of Hawaii short-term rentals.
Rising housing costs, particularly on Maui, are impacting the availability of short-term vacation rentals. There are ongoing plans to convert up to 7,000 short-term rental units into long-term housing, which could further limit options for travelers. This may mean even fewer rental choices and higher prices in the coming years. It’s a trend that makes early planning and booking ever more important.
Hawaii’s future beyond the tourism industry.
Hawaii’s future seeks to rely on expanding beyond tourism to create a more resilient economy. Without a clear focus, emerging industries, including ocean-based activities, video production, and hopefully more, will be explored as ways to diversify and provide long-term stability.
With hopes of other sectors growing, travelers might also see related new experiences and services emerge, offering a fresh take on the Hawaii experience beyond traditional tourist activities.
Hawaii’s evolving economy will undoubtedly impact the visitor experience in the years ahead. With slower growth, rising costs, a constrained workforce, and other changes in our tourism sector, visitors may experience shifts, including higher pricing, uncertain service availability, and changes to the overall feel of a Hawaiian vacation.
Staying informed and planning ahead will help you make the most of your Hawaii trip and still enjoy all that Hawaii has to offer despite these economic changes.
We welcome your thoughts!
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This sounds terrible for the visitor, what is Hawaii thinking?
Are they really relying on “hope” to grow other sectors?
Hawaii needs to come to terms with the fact that Hawaii is a beautiful island state, its main business is tourism, and it can’t “hope” itself into being something it is not!
With this attitude I would expect unemployment to skyrocket!
It is very sad that the State and County of Maui Governments ignored all the warnings from Hurricane Lane in 2018. Trying to shift the blame to Hawaiian Electric is politically popular. It is also very sad that most Maui residents resent the fact that tourists are financially much better off than the average local resident. Blaming our visitors for the widespread suffering due to a lack of housing caused by the fire is completely wrong. As a long time Maui resident, I accept the responsibility of voting for the incompetents that allowed the fire to happen and for my neighbors to perish by fire. It is always easy to blame the other guy but our government is the most responsible for all the death and destruction. If we chase tourism off the island we are only compounding the devastation caused by the fire. Dave
Probably the most honest comment of all, ever, in The Beat of Hawaii.
Its interesting that the article mentions the outer islands tourist trades are robust….but the numbers are in decline. The only savior is Oahu….but they dont outline tourist versus military arrivals…..which is skewing the numbers. I assure you that tourists arent suddenly picking Oahu over the other islands, Oahu is perhaps the least favorite island for a lot of tourists….
Its clear by the spending that Oahu is also dropping in tourist numbers too.
Hawaii needs to provide Value. The rest of the world has more value that Hawaii right now….hence the abandonment of HI after 2021/2022 when the rest of the world opened back up.
I love big island and kauai….but its no Paris, London, Stockholm, tokyo, singapore, bangkok, Fiji, Sydney, Auckland….who are amazing cultural centers too….which are now all more affordable…..
I follow your stories and appreciate much of what you do. However, this article presents a very negative look at Maui. Yes, I have a vacation rental, but it is fully functioning and may never be shut down. If it does, it will be years from now because of legal matters. Tourists can have a wonderful vacation on Maui, but articles like this one will result in them missing out because they are afraid to try. Please consider writing how most of Maui is available. It will be great if someday the economy is diversified, but it obviously won’t happen overnight. It has been talked about for years, but little has been done. The truth is Maui needs tourist business to survive economically.
Bravo Ellie.
There are always a few unhappy people. I encountered one in July when we visited Maui in July. Social media attracts them and hosts of sites sometimes choose to be negative. That’s their choice. There are plenty of South Maui accommodations available for high season, many at quite attractive prices. Smart travelers are booking now. They will be greeted with Aloha and appreciated.
I don’t agree at all, and find your statement about Maui as follows, very misleading. You stated … “the fires have impacted hotel availability, among other things. This may translate into a more limited selection of accommodations, potentially higher prices, and fewer options for travelers”. You also state that service for visitors may be suffering. There are plenty of lodging options in both hotels and other private accommodations. And I see service with a smile everywhere I go!
Thank you for posting the UHERO report. Very interesting read. I think their comments about the $25K for new home buyers is a bit off from what will actually happen though. The UHERO report reflects our experience on the islands. We normally stay at Ko’Olina on Oahu. Use to see many weddings for Japanese couples. Now hardly any. We have been to your islands since 2005. Always treated with Aloha. We volunteer at various cleanup events. Locals always ask why we are working on our vacation. We find it is a great way to visit places that we otherwise would not find and meet some great people. We find Hawaii to be a good place to vacation, even if the costs are going higher. Thank you for your articles each week. Mahalo
Congratulations Hawaii. You just ruined your toursim industry. I’ve been to Hawaii 14 times in my life and I thank God I did when it was affordable. However prices have increased so much that I will no longer be visiting Hawaii. And I suspect that will be the case for a lot of other repeat tourists. You may be able to get the one time traveller visiting the islands but the repeat traveller is all but done.
Hotels/short term rentals are expensive in all tourist destinations. I continue to believe that a Hawaii vacation is a good deal; -the year round beautiful weather,free beaches,and the natural beauty ,are some reasons why Hawaii is unique
The economic forecast is understated for Maui. I just drove through the devastated areas of the Alameda and Santiam Fires in Oregon. Those freak 2020 fires, like Maui’s wildfire, took homes and people’s lives – and four years later they are nowhere near any semblance of a “recovery.” While there was an undercurrent of hostility towards visitors before the wildfire, the hubris of the “Tourists Go Home” movement is being laid bare for all to see. Maui needs to wake up and appreciate anyone who shows up to support what they have left, let alone support a decade-plus long rebuild.
Yeah, Maui used to be number one in people’s minds…everyone wanted to be there…
I love your update, read it daily, but sorry, this one sucks! I am a property manager in the Kapalua area of Lahaina & things here are good except visitors are down, but everything is open & affordable. I’ve been in PM business for 42 years here & my prices have never been lower. Please don’t listen to the negativity of the media, Lahaina Strong or the mayor. Because I read that visitors are being treated badly I make it a point to ask every one of my guests how they were treated during their stay here. Everyone has said they were treated with respect & care. Not one visitor had a bad thing to say about how they were treated. Just the opposite. Please don’t spread bad information about Maui. It is killing jobs for we locals & making things very, very difficult for us financially. We small business owners are barely hanging on. It is not fair because Maui Is Open. Aloha still lives here, you just have to stay out of the big hotels & use small businesses that have low prices.
You have my sympathy. While I believe that you do your best, the lodging experience is only part of the whole vacation experience. On my last, and maybe final, trip to Maui I booked two dive trips by two different providers, and while the dives were fine the human interactions were some of the worst I have had in my 20+ dive bookings in Hawaii. I am even convinced one of the boat captains changed some of my computer settings after I was rebuffed for wanting to set up my own gear. Things like that leave a bad impression.
The last time i was on Maui, i use an operator from Kihei boat launch….this backwoods hut named boat company was the worst experience i have ever had on a dive boat. The visitor numbers were dropping a lot before the fires due to affordability and attitude….its sad to see it continue.
All I can say is, they did it to themselves.
My customers, family and friends all know that my wife and I regularly travel to the islands at least twice a year.
Post pandemic travel restrictions and before inflation took off I helped several individuals book a Hawaiian vacation.
But after Lahaina fire nothing haven’t spoken to anyone interested in vacationing on the islands in over a year.
Why?
Those that went were blown away by high cost of everything. After Lahaina fire negative vibes coming from Maui put a nail in the coffin on those planning a trip to the islands.
We are not wanted message was heard loud and clear.
Then there’s inflation the cost of everything has gone out of sight. Food, housing, insurance, gas and after school care costs are off the chart here in California.
Staycation is back in vogue.
Leadership continues to drop the ball. Covid was that opportunity and learning lesson to diversify revenue streams. The lack of action and common sense is mind boggling. Tourism cannot be our sole source of revenue. We ship billions to Las Vegas, yet “pretend” we’re all against gambling. It’s ridiculous. If the argument is crime, it’s already here. At a minimum, there’s no reason we cannot allow online gaming, sports betting, etc – where there’s no local presence, outside of licensing in Hawaii – what’s the hold up? Prove me wrong. Get with it Hawaii legislature.
I dont think online gaming is a be all solution as you mention….look to Canada, specifically the province of Ontario that has tons of online gaming…..you dont have as good as revenues as you think along with addiction issues.
Nice to hear the STR’s owners two cents worth.
Let’s talk about the elephant in the room. The causal shortage of the declining economy is a sharp drop off in tourism on Maui following the anti-tourist sentiments and actions by Mayor Bissen and Governor Green. Although you see comments about costs, hotel and other expenses on Maui are not dramatically different than before the Lahaina fire. But after being told to stay away, or come with sensitivity, people began to reevaluate their past plans and began to look elsewhere, discovering more cost-effective options.
The Golden Goose is on life support, and no more Junkets by Bissen and Green, like the latest to LA, will resuscitate it.
Trying to alter the economy of Maui, rather than restore the tourist industry, will take decades. But by then tens of thousands more locals will have departed. Wake up and smell the coffee. It’s bitter. And no reasonable plan is even remotely on the horizon to make it better.
Come to Maui. You’ll love it. It will be less expensive than a mega amusement complex in Florida and you will find helpful, caring hosts that are real people. All the talk about staffing shortages is not justified. We have repeat customers in our STR that always return and book their next trip immediately. Enough negative bashing.
Totally agree. A couple of friends of mine just got back…got a good discounted rate on Kaanapali Beach, not too many people, beaches were clear and clean, they loved it. It’s the best time to go there, IMHO. We will be there in January, cannot wait!!!
But hawaii is significantly more expensive than all of europe, other parts of the pacific and Caribbean….
Bonaire/Fiji for diving are a third the cost that Hawaii….yet are fully welcoming. I can get an entire week in those locales for the cost of a single day in Hawaii…..and they want me there. (flights are the same price)
I am not surprised Japan isnt coming….thier salaries are significantly lower than other western countries added to the high dollar…they are seeking more affordable options…..
Now is a great time to go to Maui. Vacancy is down and short term rentals are lowering nightly rates.
The island offers many activities and beautiful beaches.
Sad to see so much bad, and inaccurate, press out there.
I was hoping to come to the Hawaiian islands in year 2025, Maui specifically. After the fire I would like to come and support some of our favorite places to visit. However, Airfare has doubled and a 3 BDRM condo for 1 week was costing $6000. I have canceled my annual meeting that I have been attending for some 25 years, no airline flight, and canceled my condo reservations. I feel the increased costs are not justified and border on gouging status. Hopefully I’ll be able to come back soon.
3 BR condos are hard to find. The reason is that there’s almost no demand. Have you tried getting a 2Br and a 1Br or two 2Br’s in the same building?
A cheap hotel will run you at least $1000 per night per room + tax. You’d need two. That’s about $16,500 per week and you wouldn’t have a kitchen, laundry or living room