Firms give state poor ratings

By Sean Hao
Advertiser Staff Writer

A Chamber of Commerce of Hawaii survey of 156 O'ahu companies provides a harsh although not entirely surprising assessment of state government's support of business.

Conducted under an initiative aimed at retaining and expanding Hawai'i's busi-nesses, the survey tried to identify barriers to business so that the resources of government, financial institutions, schools, community groups and others can be coordinated and solutions developed.

"We see this as a tool to work with state government and also the Legislature to look at some of these challenges and work together," said chamber President Jim Tollefson.

If the results of the nonscientific survey are any indication, chamber officials have a lot of work ahead of them. Among the report's key findings:

• Government agencies don't treat businesses like customers. This creates an adversarial rather than supportive relationship. Eight of 11 state agencies were rated fair to poor more often than good to excellent.
• Public schools need to better prepare students for higher education or careers. Eighty-two percent of businesses surveyed rated the state's public kindergarten through high school institutions as poor to fair.
• Workforce availability and quality both received predominantly poor to fair ratings with attitude and work ethic in entry-level applicants a concern.
• The rising cost of workers' compensation, liability and health insurance are stifling small business.

For a state not known for its business friendliness, the findings weren't entirely unexpected, and the criticisms have been voiced before. "There are no big surprises in the report," Tollefson said.

At the same time, 71 percent of businesses were optimistic that the state's business climate would improve in three years and 85 percent characterized their attitude toward Hawai'i as very positive.

When asked to rate the state's various agencies, only three — the Department of Agriculture, Department of Commerce and Consumer Affairs and the Public Utilities Commission — were rated good to excellent as often or more often than they were rated fair to poor.

The Department of Labor and Industrial Relations was rated fair to poor by 44 percent of respondents, which was behind only the 45 percent fair-to-poor rating for the state judiciary. The Labor Department was criticized for heavy-handed enforcement of regulations and a bias against employers.

"We obviously agree with part of that assessment," said James Hardway, a Labor Department spokesman. "One of our major goals when we took over the Department of Labor (after Republican Gov. Linda Lingle's election) was to change that attitude.

"We've taken large steps to try and address that."

Among those steps was directing the Hawai'i Occupational Health and Safety Division to issue warnings rather than citations for those violations that can be fixed on the spot or within a short period, Hardway said.

Interviews with the businesses surveyed were conducted in one- to 2 1/2-hour meetings late last year. However, because those surveyed weren't drawn from a statistically representative pool, the results are not considered scientific.

This year, the chamber's goal is to interview 200 additional businesses while increasing its network of state and private-sector problem solvers.

The project is partially financed by the Gannett Foundation, a charitable arm of Gannett Co., which owns The Advertiser.

Reach Sean Hao at shao@honoluluadvertiser.com or 525-8093.