After devastating wildfires, Hawaii seduces tourists to return their dollars

Richie Olsten has been in the helicopter tour business for half a century in Mauiso long that he has devised a barometer of the economy dependent on tourism: the rental cars parked at the island’s airport, in the Hawaii archipelago.

There are so many since wildfires killed at least 115 people in the historic city of Lahaina that Olsten fears there will be another an economic catastrophe of enormous proportions. Restaurants and tourism businesses are laying off workers and unemployment is rising.

State tourism officials, after initially urging travelers to stay away, are now asking them to return, avoid the burned area and Help Maui recover by spending money.

Airlines have begun to offer great discounts, while some resorts have reduced room prices by 20% and in some cases offer a fifth night free.

“I know it was a terrible disaster. But now we’re in crisis mode,” Olsten said. “If we can’t keep people who have jobs employed, how are they going to help the family and friends who lost everything?”

The number of tourists coming to Maui dropped by 70% up to 2,000 per day after the fire on August 8.

Olsten’s helicopters, Air Maui Helicopters, now make one or two flights a day, compared to the 25 or 30 they did before the fires.

As Air Maui’s chief operating officer, Olsten said his company has laid off seven of its twelve controllers. The pilots have been saved because they only get paid when they work. Typically, they fly eight times a day, four to five days a week. That has been reduced to one day a week and only one or two flights.

Many Maui hotels are housing federal aid workers and Lahaina residents who lost their homes. However, only half of the available hotel rooms are occupied, said Mufi Hannemann, president of the Hawaii Lodging & Tourism Association.

Even those in south Maui, 30 miles south of Lahaina, are half empty. Hannemann called the situation “pretty bleak.”

One of Maui’s oldest restaurants, Hali’imaile General Store, laid off about 30 workers and closed temporarily after activity slowed to a tenth of pre-fire levels.

“It went into a tailspin,” said Graeme Swain, who owns the venue with his wife, Mara.

They reduced the number of employees to preserve cash and prevent Hali’imaile from suffering the fate of the San Diego software company that Swain ran in 2008. When the housing bubble burst and the United States sank into recession, he kept all the employees employees “until the sad end”, bankrupting the company.

Swain wants Hali’imaile – which was founded a century ago as a general store for pineple plantation workers and converted to a restaurant in 1987 – to last decades more.

“It takes some soul-searching to know what needs to be done to protect this place,” said Swain, who plans to rehire all of those laid off. His goal is to reopen next month.

Mass layoffs pear in government data. Nearly 8,000 people filed for unemployment benefits on Maui during the last three weeks of August, compared to 295 during the same period in 2022.

Economists at the University of Hawaii predict Maui’s unemployment rate will reach 10%. It peaked at 35% during the Covid-19 pandemic, but in July it was just 2.5%. And this time, there are no Paycheck Protection Program business loans like during the pandemic, nor increased unemployment benefits for the unemployed.

Fashion designer Gemma Alvior estimates that locals make up almost all of the clientele at her Kahului store, Pulelehua Boutique. But that may not protect her in a place where the tourism industry accounts for 75% of private sector jobs.

“If they don’t have a job, if they get fired, how are they going to buy things? Why do they need to buy clothes if they’re not working?”

One reason visitor traffic plummeted is that Hawaiian officials, joined by Hollywood celebrities, told travelers to vacate the island.

The day after the fire, the Hawaii Tourism Authority, a quasi-state body, said that “visitors who are not on essential travel are asked to leave Maui” and that “non-essential travel to Maui is strongly discouraged.” Maui.”

The agency expressed that the community needed to focus on recovery and helping those who had to evacuate.

Videos and photos were seen around the world of travelers packed into the Kahului airport to board departing flights.

The message has changed since then. “Maui is not closed,” Mayor Richard Bissen announced in a recent interview.

People shouldn’t go to Lahaina or the surrounding area of ​​West Maui – “It’s not a place to go and look,” Bissen said – but the rest of Maui needs tourists. “Respect the west, visit the rest” is the motto that some have adopted.

The Hawaii Tourism Authority produced and published a m showing Lahaina and West Maui in relation to the rest of the island, highlighting how much there is still to visit. The authority has also launched a $2.6 million marketing plan to attract tourists again.

Two days after the fire, Jason Momoa, a Hollywood actor and a native of Hawaii, told his 17 million Instagram followers: “Don’t travel to Maui.” More recently, he advised: “Maui is open. Lahaina is closed.”

Carl Bonham, an economics professor at the University of Hawaii at Manoa, predicted that travel to areas outside of West Maui should return to pre-fire levels by Thanksgiving time in November. Discounts on airfare and promotional messages should help, he said.

Gov. Josh Green said at a State Board of Revenue meeting that he expects officials to reopen most of West Maui to travelers on Oct. 8, with the exception of neighborhoods damaged by the fire. The area, which includes beach resorts in Kaanali, north of historic Lahaina, has 11,000 hotel rooms, half of Maui’s total.

The catastrophe led state authorities on Wednesday to lower the economic growth forecast for 2023 statewide from 1.8% to 1.1%. Next year, they expect growth of 1.5% instead of 2%.

Bonham estimated the fires will reduce the state’s tax revenue by $250 million this fiscal year, but said he was “encouraged” by the plan to reopen West Maui within a month.

The Council, which makes tax revenue forecasts, predicted Thursday that the state’s tax revenue would increase 1.3% during the current fiscal year compared to last year. The governor and legislators are required to use that body’s forecasts to prepare their budgets.

Translation: Elisa Carnelli