A slow but steady strengthening of Hawaii’s job market pushed the state’s unemployment rate below
5 percent in April for the first time since late 2008, the state Department of Labor and Industrial Relations reported Thursday.

The unemployment rate fell to a seasonally adjusted 4.9 percent, down from 5.1 percent in March and
6.1 percent in April 2012, according to the report. The last time Hawaii’s jobless rate was below 5 percent was in October 2008 when it also was 4.9 percent.

The national unemployment rate fell to 7.5 percent in April from 7.6 percent in March.

The department also reported that Hawaii employers boosted their payrolls by 3,000 workers in April from March.

The statistics in the report jibe with recent anecdotal evidence that businesses are ramping up hiring.

Wednesday’s job fair at the Neal Blaisdell Center attracted 171 employers, 21 more than signed up to recruit at a similar event four months earlier.

While Thursday’s report is welcome news, Hawaii’s job market is a long way from returning to full health, said Lawrence “Bill” Boyd, an economist at the Center for Labor Education and Research at the University of Hawaii at West Oahu.

“We’re still feeling the lingering effects of the recession,” Boyd said. And potential furloughs being faced by federal workers in Hawaii as a result of budget cuts could serve as a drag on economic growth, he added.

The economy has yet to regain the nearly 40,000 jobs lost during and after the 2008-2009 recession.

And April’s unemployment rate is still well above the monthly average of 2.7 percent in 2006.

“Full employment in Hawaii is around 3 percent. That’s a number we need to be shooting for,” Boyd said.

An economy is considered to have reached full employment when all those who want to work can find employment at prevailing wage rates.

Another reason to be concerned about Hawaii’s job market is the shrinking size of the labor force, Boyd said. The Department of Labor and Industrial Relations reported Thursday that there were 645,850 people in Hawaii’s labor force in April, down 1,550 from March and 6,300 from April 2012.

People who are unemployed are counted as part of the labor force as long as they are looking for a job. But when individuals who are unemployed stop looking for work, they are no longer counted as part of the labor force.

When discouraged workers are added in, along with those who are working part time but want full-time work, Hawaii’s unemployment rate is 12 percent, according to the department.

The data used to calculate the state and federal unemployment rates are adjusted for seasonal variations, such as high school and college students looking for jobs during the summer months.

County data are not seasonally adjusted.

The unemployment rate fell in all counties in April from March. It dropped to 3.9 percent from 4.4 percent in Honolulu County, to 4.8 percent from 5.4 percent in Maui County, to 5.7 percent from 6.2 percent in Kauai County, and to 6.6 percent from 7.2 percent in Hawaii County.

The labor force data are derived largely from a survey of households. Payroll numbers are generated from a separate survey of businesses.

Of the gain in 3,000 payroll jobs in April, the biggest increase was in the leisure and hospitality industry, which added 700 positions. Jobs in trade transportation and utilities went up by 400 and financial activities added 300 jobs.