Hawaiʻi has 90,000 restaurant jobs (almost 15% of our workforce). Money spent at restaurants is a powerful economic multiplier: $1.00 spent contributes to $1.62 to the state economy. That’s real impact.
Hawaiʻi restaurants also benefit from an X-factor of nostalgia. (The memories, place, and sentiments have long substituted for margin discipline, labor stability, and operational rigor.) That safety net no longer holds, though, as external forces, like a minimum wage bump, apply pressure. This is a good thing.
The 2026 mandated $2.00 minimum wage hike, to most restaurateurs’ and owners’ chagrin, feels like an ambush. The gripes are predictable. More threats of closures, layoffs, and reduced hours. Yes, lists of restaurants closing are painful to see. But, the minimum wage mandate exposes what’s already not sustainable. Many of these restaurants that close are zombies to begin with, floating on cheaper labor and hope; restaurant economics are falling apart, and ready to be born again.
Ten years ago, I led a food and hospitality company on the east coast supporting neighborhood restaurant groups to combat the erosion of (then) traditional restaurant margins. Restaurateurs were outraged with the launch of UberEats; consumers wanted more fast casual, i.e. Chipotle. What happened when “outside forces” threatened the models? The best operators adapted and grew food empires. Landlords and suppliers reassessed. Consumers did too. It’s how healthy markets work.
What is evolving today is a vertically-integrated approach to feeding people, and with more partnership plays. (Again, a very good thing.) Foodland opened Eleven, et al, Mahi‘ai Table, and Redfish as part of their broader model; Chef Jason Peel of the now-closed Nami Kaze is revamping Diamond Head Market & Grill; Asato Family Shop is expanding with a posh dessert bar in the King & Queen’s store; Farmlink, who moved from restaurant supplier (B2B) to consumer delivery (DTC) during COVID, now partners with ‘ili‘ili Cash & Carry for a joint take out spot and retail grocer (B2C).
So, for the beloved restaurants that close (nothing lasts forever), they’ll be missed. Staff will ultimately be cycled into better models of employment and take lessons learned with them. Do we really want old models that rely on payouts of sub-poverty, sub-ALICE wages? (That’s rhetorical.) The goal should be good food, good jobs, fair wages.
Eat your values in 2026. Spend your money at places that figured this out as more do.
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Prediction No. 1: Hawaiʻi’s Systems Get Exposed from the Outside In
Prediction No. 2: More Restaurants Close; Better Ones Open
Prediction No. 3: Entrepreneurship Still Belongs to the Exceptions
Prediction No. 4: Philanthropy Faces More Watchdog Pressure
Prediction No. 5: Kamehameha Schools Has an Old Is New Again Moment
Prediction No. 6: Non-Local Short Term Rental Owners Begin to Blink
Prediction No. 7: DPP Is Hawaiʻi’s Economic Chokepoint