Twenty four percent of Hawaii businesses reported that they will permanently close without additional financial support—even after receiving federal Paycheck Protection Program loans—in a new analysis conducted by the University of Hawaii Economic Research Organization (UHERO), Chamber of Commerce Hawaii and 12 other industry associations.
The survey of 623 Hawaii businesses found that 31 percent of respondents’ revenues have been reduced to zero, and 220,000 full- and part-time workers have lost their jobs. The most economically vulnerable employees were the most likely to lose their jobs.
“UHERO’s analysis leaves no doubt that Hawaii businesses have been devastated by the Coronavirus pandemic—and federal assistance alone will not be enough to save them,” Sherry Menor-McNamara, President & CEO, Chamber of Commerce Hawaii, said. “Losing a quarter of our local businesses was once unimaginable, but this will quickly become our reality without further government action to aid stabilization and recovery. Significant state and county support for businesses is long overdue, in particular for the industries and employee demographics that the analysis identified as especially hard hit.
“These data provide otherwise unavailable insight into the impacts of the economic crisis by industry and geography,” UHERO Executive Director Carl Bonham said. “They are already being used to inform our forecast work and contain many interesting findings.”
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Other highlights of the survey analysis include:
- In total, about one third of businesses reported that their revenues have been reduced essentially to zero during the shutdown.
- Hotels and retail businesses were most likely to lay off employees.
- Part-time workers were more likely to lose their jobs than full-time workers.
- While the federal Paycheck Protection Program will increase employee retention, it will not be enough to sustain many businesses.
- Employees in the salary range of $30,000-50,000 will see the highest percentage of job losses by status and salary.
- 60 percent of businesses reported being able to return to full staff almost immediately after reopening, while the remainder would return to full staff upon the return of tourism.
- Businesses that provide educational services, including tutoring, test-preparation and private pre-K services are down 54 percent during the crisis and are anticipating a similar drop in revenues this year.
Other participating industry association include the Chinese Chamber of Commerce, Hawaii Food Manufacturers Association, Hawaii Foreign-Trade Zone, Hawaii Island Chamber of Commerce, Hawaii State Bar Association, Kalihi Business Association, Kauai Chamber of Commerce, Kona-Kohala Chamber of Commerce, Maui Chamber of Commerce, Molokai Chamber of Commerce, Pacific Resource Partnership, and the Retail Merchants Association of Hawaii.