Report: Hawaii's hotel revenue back to pre-pandemic levels

by Merrilee Gasser, The Center Square, Feb 22, 2023

(The Center Square) – A new report shows that Hotel-generated state and local tax revenue in Hawaii is expected to surpass pre-pandemic levels by 16.6%.

The American Hotel and Lodging Association, the largest hotel association in America, projects Hawaii’s tax revenue from hotels will surpass $1 billion in 2023. In 2019, that number was a little over $900 million.

Hawaii is also expected to have the highest hotel occupancy in the nation, similar to Hawaii’s hotel occupancy rate in 2019.

With the average hotel occupancy projected to be about 63% across the nation this year, Hawaii is projected to have a 78% occupancy rate. Its rate in 2019 was 80%, the report showed.

The state of Hawaii has been tracking its post-pandemic recovery in the tourism industry. The number of visitors at the end of last year represented a 91.5% recovery to 2019’s high, according to the latest report from the Department of Business, Economic Development and Tourism (DBEDT)

Visitors spent $1.90 billion in December 2022, an increase of 8.2% compared to $1.75 billion reported in December 2019.

Though hotel tax revenue is set to increase, the average U.S. hotel occupancy has yet to return to pre-pandemic rates, as noted in AHLA’s report. The average hotel occupancy in 2023 is projected to reach 63.8%, while in 2019, it was 65.9%.

That means fewer people stay in hotels on average, yet tax revenue is still projected to increase.

Meanwhile, the hotel industry is still trying to rebuild its workforce post-pandemic, the AHLA report said.

“Hotels are making significant strides toward recovery, supporting millions of good-paying jobs and generating billions in state and local tax revenue in communities across the nation,” said AHLA President and CEO Chip Rogers. “To continue growing, we need to hire more people. Fortunately, there’s never been a better time to be a hotel employee, with wages, benefits, flexibility and upward mobility better than ever before.”

The hotel industry has been attempting to attract workers with historically high wages of over $23 an hour and offering better benefits and flexibility. There are still around 100,000 open hotel jobs nationwide, according to AHLA.