Pandemic knocks out large sections of Hawaii's economy
HONOLULU — In normal times, Roland Chang and his three sons start their day at dawn, picking up tourists in Waikiki and driving them to the ocean for a boat ride to see dolphins and turtles swimming in clear blue waters. Four nights a week, the family’s band performs Hawaiian music and popular songs at a hotel.
Their friends call them workaholics. To them, it’s a routine. Or was until the coronavirus pandemic landed in Hawaii.
Like many businesses in tourism-dependent Hawaii, the Changs’ company has had no income for two months. And they don’t know if it will survive to see a post-COVID-19 world. But they agree with the restrictions imposed in the name of public health. And the family, who is Native Hawaiian, believes there will be rebirth afterward. Roland Chang’s sister NJ compared the wreckage to the way the fire goddess lays waste when a volcano erupts and lava flows across the land.
“Madam Pele has always cleaned out. I think that’s what we’re going through,” said NJ Chang, a school teacher and band vocalist and guitar player. “This is a cleaning out process, I believe, for us to all heal.”
Much healing will be required.
A University of Hawaii survey of 623 businesses conducted with the Chamber of Commerce Hawaii showed 34% had no revenue last month. In Maui County — which is even more heavily reliant on tourism than the rest of the state — that number was 61%.
Among arts, entertainment and recreation companies — which include tours like the Changs’ — employment has declined 82% compared to January. Revenues in 2020 are forecast to sink 65% from last year.
The numbers are similarly ugly for hotels and almost as bad for restaurants and retailers. Statewide, the unemployment rate is estimated to be between 25% and 35%. Food distribution events run by the Salvation Army and other nonprofits draw lines of cars that stretch for miles.
The Changs are living on savings. Their company, EO Waianae Tours, which has four full-time employees, applied for a Paycheck Protection Program loan for small businesses to help them get through the crisis. They're not applying for unemployment benefits.
They have some investment funds they were thinking about using to expand their business but they may now hold off because the future is so uncertain. Their tour business may even have to close.
“I think there are a lot more questions than answers,” Roland Chang said. “I’ve got to guarantee that everyone on my boat won’t get the virus. How do I protect them?”
Among the unknowns: Do they reduce the number of people on their boat (it can hold up to 26 passengers and four crew) so everyone can practice social distancing? Will they have to raise their tour rates to break even as a result? Will they need disposable snorkel gear for clients instead of lending them gear as in the past? Will travelers even come?
“On the totem pole of life right now, people are just trying to put food on the table. Until that gets rectified, it’s going to be hard to say how many people are going to actively, consistently keep the tour business open,” he said.
To slow the spread of the virus, Hawaii Gov. David Ige issued a stay-at-home order in late March and mandated that all travelers adhere to a strict 14-day quarantine when they arrive in the islands. The number of tourists has slowed to a trickle of about 200 per day, down from 30,000 before the pandemic.