Big Island hotels cut staff
Two hotels have fired a total of 59 workers as tourism declines
Two Big Island hotels have cut staffing in order to survive the economic downturn that has caused occupancy to plummet statewide.
The Outrigger Keauhou Beach Resort has permanently laid off 34 people, including 22 full and part-time employees and 12 on-call workers, at the Kailua-Kona hotel, whose work force now totals 145.
Meanwhile, the 1,240-room Hilton Waikoloa Village said it has laid off 25 workers since July, or 2 percent of its 1,107-member work force, in the face of declining occupancy that isn't expected to reverse in the near term.
"All hotels are having some reduction," said Richard Baker Jr., Big Island division director for the International Longshore and Warehouse Union, Local 142. "It's getting to be extremely slower, that's why some adjustments are made."
The Big Island's total visitor arrivals in June fell by nearly 24 percent, while expenditures were down 25.3 percent.
The layoffs come on the heels of massive cuts at Maui Land & Pineapple Co. and Molokai Ranch, and about three-dozen staff reductions at the Kaanapali Beach Club on Maui.
"The layoff is what we needed to get through this year and we're hoping things will come back," said Paul Horner, general manager of the 309-room Keauhou Beach Resort, adding that the hotel is expecting a drop of between 10 percent and 15 percent for the remainder of the year.
The Fairmont Orchid Hawaii on the Kohala Coast has been preparing for a downturn since January, requiring employees to take 50 percent of their vacation during the slow seven-week period prior to Aug. 1. In turn, the hotel covered health-insurance benefits for the several dozen workers who were temporarily laid off. The 540-room hotel also allowed staff to temporarily transfer to other Fairmont properties worldwide.
"We employed all other methods to keep our people on the books," said Aven Wright-McIntosh, director of public relations. "It's hard to find good people; we want them to stay so when we need them, they want to come back."
Big Island hotels posted 57.2 percent occupancy in June, with an average daily rate of $202.13 and revenue per available room at $115.62, according to Hospitality Advisors LLC. That compares to 67.1 percent occupancy in June 2007, and an average daily room rate of $194.55 and revenue per available room of $130.54.
"Whenever the market softens up, hotels will try their best to staff their hotel, especially in a tight labor market, but the facts are the longer the downturn, the more hotels have to look at all options in curtailing costs," said Joseph Toy, Hospitality Advisors president.