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The Honolulu Advertiser
Posted on: Monday, November 17, 2008

Hawaii workers who rely on tips hit harder by weak economy

By Dave Dondoneau
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Breakfast may be a bargain at Seaside Bar & Grill in Waikiki but that's still not enough to guarantee workers a decent-sized tip.

REBECCA BREYER | The Honolulu Advertiser

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For eight years, John Le has served affordable breakfasts at Waikiki's Seaside Bar & Grill. Just $3.75 gets you two buttermilk pancakes, two strips of bacon, two large scrambled eggs and service with a smile.

Until about a year ago, there was enough business that Le and his fellow workers took home about $100 a shift in tips.

Not anymore.

"What we're seeing is people are very sensitive right now to what they buy and pay for," Le said. "We're lucky now to take home $60 a shift. It's like that way all over for everyone."

Most people in the service and tourism industries have been hit hard by the weak economy. But many of those who depend on tips — rather than a fixed paycheck — have been hit especially hard.

"It used to be if it was a $40 bill you'd get people rounding up to $50 with tip. Now it's likely to be a $6 tip," said Scott Nishiki, who tends the bar and waits on bar-area tables at Big City Diner under Ward Stadium Theatres. "On $20 tabs it used to be a $5 tip. Now it's $3. When you add up 25 to 30 tables a night, that's $60 less in tips easy."

Lind Nova, a waitress at Big City Diner, said waiting staffs are working harder for less money.

"When we opened five years ago visitors were throwing money at us. It was unbelievable," Nova said. "It's still good now and on weekends and days we're still packed, but the economy has affected us. It may be one person less on the shift, so you work a few more tables to make up for it. I'm maybe making $75 less a week and you have to work harder for it."

SECOND JOBS

Le is coping by picking up bartending shifts at various spots at night, he said, but second jobs are getting tougher to come by.

Hotels and restaurants are trying to retain their staff, but the dwindling occupancy rates make it tough, said David Carey, president and CEO of Outrigger Hotels.

Instead of layoffs, many businesses are offering employees shorter shifts or fewer workdays.

"I have not slept well the past few months," Carey said. "It's an interesting philosophical decision we face, whether to spread the pain over everybody or send a few people home. No matter what you choose, it's a difficult choice to make. Sometimes we give the departments a choice as to what to do.

"The big question we all face is how long will this economy last? If it lasts a long time, you may look at things differently. If it's only a little while, you do whatever you can to keep your best employees. They have families to support and bills to pay."

Carey said the biggest downturn in tourism is on the Big Island, where 25 Outrigger employees were recently laid off and more could follow.

NEEDED EMPLOYEES

The people who depend on tips are the tourism industry's first line of aloha: They park cars, greet guests at the door, take their bags, bring food and refill glasses. They also make the beds and make sure there are clean towels in the rooms.

They are asked to be engaging and cheerful — and tend to get more tips if they are.

But it's not always easy.

"Rents and mortgages go up and so does the cable bill, the phone and electric bills," Le said. "Tips are down ... It's tough to make it."

Greg and Rosemarie Medina of Tracy, Calif., who have vacationed on O'ahu the past four years, said the depressed economy is obvious in Waikiki.

"It's quieter on the streets and I hate to say it, but now it's almost like Mexico," Rosemarie Medina said. "You've got a lot more panhandlers on the streets asking for money, and the workers at the International Market are a lot more pushy."

Kainoa Cabanilla, a valet for five years at the Outrigger Reef and Embassy Suites hotels, said kama'aina continue to tip valets, but more tourists are not.

"Sometimes hotel guests may look at it costing $25 a day for parking for a car and don't tip," Cabanilla said. "The local crowd always takes care of you when they come, but you can definitely feel the economy because it is slower. Five years ago the take-home was maybe $80 to $150 a shift. Now it's more like $60."

On Veterans Day, he and his fellow valet at the Reef hotel loaded luggage and fetched cars for several hotel guests for more than an hour before they saw their first tip.

SOME DOING FINE

Jesse Greenleaf, a bartender at Duke's, said he is one of the luckier workers in Waikiki. His restaurant and bar's location and reputation have helped it weather the crisis.

"We're maybe not seeing as many people as before and we've cut back a bit on our staffing," Greenleaf said. "But our Sundays with the local crowd is still good. We still tell people to get here at 2 if you want a seat, and by the time the music starts at 4 on Sundays, the place is packed. Locals have always tipped well."

Greenleaf said Duke's is seeing more visitors from Australia, Ireland, Britain and Canada. And while some of those people understand American customs on tipping, others don't realize that the wait staffs depend on tips for income and survival.

Outrigger CEO Carey said valets, doormen, bellhops, restaurant employees and others play a critical role in Hawai'i's tourism success. Retaining the good ones is essential for success, he said.

"They are the first impression for visitors," Carey said. "They are the first at the door, and you hope that first moment always goes well.

"We're just starting to look at how to deal with this economy. We may look to see if there's a way to adjust pay for people who work for tips so they can make it through the down times when there's not a lot of tips. There's a lot to think through."

Reach Dave Dondoneau at ddondoneau@honoluluadvertiser.com.