We hear it all the time. The suggestion is that Hawaii is ripping off its visitors. The reality isn’t how some commenters would like to portray it, and it is far more complicated than that.
Countless people have blamed the state for the high costs of Hawaii travel and questioned what it is doing with their hard-earned dollars. And there are no two ways about it, the cost of Hawaii vacations (and non-Hawaii vacations) has skyrocketed. We see it, too, when planning trips outside of Hawaii instead of your trips to Hawaii.
Why Hawaii Visitor’s Money Doesn’t Always Help Hawaii.
Sure, we’d like to think that at least a good part of the money we spend on a hard-earned vacation would return to the local economy. Ideally, it would help local businesses and, in doing so, offset Hawaii tourism’s negative impacts.
However, that isn’t exactly what’s happening. Most of the money spent in Hawaii doesn’t stay in Hawaii. For the large part, it ends up feathering the pockets of big companies with little to some Hawaii connection. That’s true, however, for so many other visitor destinations everywhere, and it comes at a time when more than ever before, global tourism is eroding the quality of life in places from Hawaii to Barcelona, Greece, and elsewhere.
Where you stay matters.
When it comes to Hawaii accommodations, corporate hotels return far less to the local economy than do locally owned ones. It just isn’t hard to figure out. Search for who owns XYZ hotel and you’ll soon know where it is own. See the example below.
Locally owned hotels and vacation rentals retained more than 90% within the local economy. However, we must point out that non-residents own most Hawaii vacation rentals.
Support Hawaii through where you eat, stay, and shop.
You can’t wholly support local, but you can, to a large degree, do so and help Hawaii.
- To support local, look for Hawaii-owned companies rather than national businesses. That helps to move the needle towards a more sustainable Hawaii tourism product.
- Seek out locally-owned restaurants, especially ones focused on locally-grown food products. Shop at Hawaii farmers markets.
- Be suspicious. Research. Don’t assume something’s locally owned or produced; check and ask questions. Did you know, for example, that many inexpensive Hawaiiana souvenirs visitors assume are from Hawaii are actually from the Philippines?
- Car rentals are more problematic because there’s a comfort level renting from national brands. Turo has its own issues, but, on the other hand, it can be an option to go more local.
- Seek out and stay at Hawaii-owned hotels and vacation rentals.
Taxes, taxes, taxes. Those do stay here, somewhere…
The taxes you pay, however, do stay here in Hawaii, so that’s on the state regarding what happens with that money. It’s an area where you’re likely to find a lot of agreement between visitors and residents. We all don’t see where it goes. As you may know, Hawaii taxes everything, including food, and both residents and visitors pay all taxes, including those on accommodations. But that’s outside the scope of what we’re discussing here, and Hawaii’s taxation and spending of tax money is certainly something we might all consider. Recently a bill started through the Hawaii Legislature to implement a 33% accommodation tax.
Why most money visitors spend in Hawaii doesn’t stay here.
1. What about Hawaii accommodations?
Large hotel chains aren’t owned in Hawaii. The money is shared between the owners, based elsewhere, and their management company. Not to say that many jobs aren’t being created locally because they are. Are those high-paying jobs? Mostly not. So, simply put, much of the money visitors spend on hotel stays doesn’t stay in Hawaii. And the rates charged are up to those corporations, which Hawaii has no control over.
The featured image above is of Waikiki’s iconic Hilton Hawaii Village. Park Hotels and Resorts own it. That company “is one of the largest publicly-traded lodging real estate investment trusts (REIT).” That’s the norm rather than the exception, and a simple search of “who owns” yields this about virtually any Hawaii hotel.
When you stay at a vacation rental, chances are some money remains in Hawaii, depending on the circumstances. If you rent from publicly traded, troubled Vacasa, that isn’t the case, while if you rent from a local management company or a Hawaii-based owner directly, far more of the money stays here. Also, remember that there is a money split between the property owner and the vacation rental management company, and many, if not most, vacation rental homeowners aren’t based in Hawaii. More than three out of four Hawaii vacation rentals are believed to be owned outside Hawaii.
2. Where does Hawaii car rental money go?
The same is true at Hawaii car rentals. These multinational corporations have cars and staff in Hawaii, but again, most of the profit is exported, and the jobs created aren’t, for the most part, high-level.
3. What about Hawaii restaurants, grocery stores, and farmers’ markets?
Some restaurants, even chain ones, are locally owned. But that’s not always the case. One example is Roy’s restaurants, which are Hawaii-owned.
And speaking of food, most of the food sold and consumed in Hawaii is not produced here.
Grocery stores are generally unclear in terms of ownership. While there’s no doubt about that when you go to a Hawaii Safeway, local stores are more confusing. Hawaii’s Times Markets, for example, is owned by Tokyo-based Don Quijote Holdings Co., Ltd. Foodland grocery stores, on the other hand, as well as KTA Super Stores, are Hawaii-based company and always have been. ABC Stores are Hawaii owned.
Therefore, food money from a grocery store or a restaurant is often heading straight out of Hawaii.
That isn’t true at Hawaii Farmers Markets, where most of the money stays on the island.
4. Hawaii activities are generally local businesses.
Most activities are likely to be island-owned and operated. That’s one industry you can generally be sure of. Buy them directly from the provider rather than via TripAdvisor’s Viator.
5. Hawaii airline tickets, not so much.
The only airline with a strong Hawaii basis is Hawaiian Airlines. While other airlines, including Southwest, United, and others, maintain a significant number of Hawaii employees, as with hotels, the jobs created in Hawaii aren’t, for the most part, high-level. Hawaiian remains the largest private employer in Hawaii, and nearly their entire team of some 7,000 staff at all levels is based here. So that does keep a much larger part of the money in the state. But as we’ve mentioned, even Hawaiian is a registered Delaware corporation, not a Hawaii one. And their telephone call center is outsourced to the Philippines.
We look forward to your thoughts. Can you share examples of ways you’ve been able to help Hawaii by thinking locally instead of globally?