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Infrastructure & Transportation

Averted Strike Stabilizes Oahu Public Transit, Mitigating Business Commute Disruptions

·5 min read·👀 Watch

Executive Summary

The ratification of a new four-year contract between Teamsters Local 996 and Oahu Transit Services (OTS) averts a potential bus driver strike, ensuring continued public transit reliability for businesses and employees. Businesses should monitor transit schedule adherence and potential future fare adjustments.

  • Small Business Operators: Reduced risk of employee commute disruptions and associated operational impacts.
  • Tourism Operators: Assured continued access for visitors relying on public transport.
  • Real Estate Owners: Stable commuting options for residents and employees of commercial properties.
  • Action: Monitor TheBus service advisories for any service level changes and factor transit reliability into staffing plans.
👀

Watch & Prepare

A strike was averted, but understanding the new contract's terms is important for evaluating labor costs and transit reliability for businesses in the medium term.

Monitor future fare adjustments and service advisories from TheBus. While a strike was averted, understand that contract terms may lead to increased operational costs for OTS, potentially impacting future fares. Ensure business continuity plans account for stable public transit availability for employees and customers.

Who's Affected
Small Business OperatorsReal Estate OwnersTourism Operators
Ripple Effects
  • →New contract wage increases → Higher operational costs for OTS → Potential future fare increases for TheBus → Increased cost of living for residents and travel costs for tourists.
  • →Continued reliable public transit → Reduced employee commute disruptions for businesses → Stable access for tourists to local establishments.
Bus driver operating vehicle from the cockpit in an industrial setting, showcasing control and focus.
Photo by Will Kirk

The Change

Oahu Transit Services (OTS), the private operator of TheBus for the City and County of Honolulu, and the Teamsters Local 996 union have reached a tentative agreement, averting a strike that would have significantly disrupted public transportation across the island. Union members ratified a new four-year contract on February 12, 2024. While strike action has been avoided, the terms of this new contract, particularly regarding wages and benefits, will influence operational costs for OTS and potentially impact future fare structures.

Who's Affected

Small Business Operators (small-operator):

The primary impact for small businesses is the continued reliability of public transit for their workforce. A strike would have led to increased employee tardiness or absenteeism, particularly affecting businesses with employees who rely on TheBus for their daily commute. The averted strike mitigates this immediate operational risk.

Tourism Operators (tourism-operator):

For hotels, tour companies, and other hospitality businesses, the consistent operation of TheBus is crucial. Many tourists utilize public transportation to access attractions, dining, and shopping. The resolution ensures visitors have a reliable means of getting around Oahu, supporting local tourism businesses. However, terms of the new contract could eventually lead to fare increases, which might slightly alter visitor spending patterns or necessitate adjustments in how tourists budget for local transport.

**Real Estate Owners (real-estate):

Property owners and managers, especially those with commercial or residential properties accessible by TheBus, benefit from the continued service. It ensures employees and residents have dependable transportation, maintaining the desirability and accessibility of locations serviced by public transit. Consistent transit also supports local economies by facilitating access to retail and service businesses located within their properties.

Second-Order Effects

The resolution of this labor negotiation has several downstream effects on Oahu's interconnected economy. The increased labor costs negotiated in the new contract, while necessary to attract and retain drivers, will likely be absorbed by Oahu Transit Services. Depending on the financial sustainability of OTS and funding from the City and County of Honolulu, these increased operational expenses could eventually lead to fare hikes for TheBus riders. This, in turn, could impact the cost of living for residents and the travel budget for tourists. For businesses, any increase in public transit fares may necessitate adjustments to commuter benefits or lead to employees seeking higher wages to offset increased commuting costs, thereby indirectly affecting operating expenses.

  • New contract wage increases → Higher operational costs for OTS → Potential future fare increases for TheBus → Increased cost of living for residents and travel costs for tourists.
  • Continued reliable public transit → Reduced employee commute disruptions for businesses → Stable access for tourists to local establishments.

What to Do

Given that a strike has been averted, the immediate threat to business operations is gone. However, the long-term implications of the new contract warrant monitoring.

Small Business Operators:

  • Action: Continue to rely on TheBus for employee commutes. Review your employee handbook regarding commute policies and support, ensuring employees are aware of reliable transit options. Monitor future fare adjustments to understand potential impacts on employee commuting costs.

Tourism Operators:

  • Action: Reassure visitors that public transit remains reliable. Staff should be knowledgeable about current bus routes and schedules to assist guests. Be prepared to communicate any potential future fare changes to interested visitors.

Real Estate Owners:

  • Action: Utilize the continued stable public transit as a selling point for commercial and residential property accessibility. Stay informed about any potential future fare increases announced by OTS, as this may affect tenant commuting budgets.

Monitor: Keep an eye on TheBus service advisories for any announcements regarding service frequency, route changes, or fare adjustments over the next 12-18 months as the terms of the new contract are implemented.

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