Hawaii’s unemployment rate held at 3.2 percent in May to remain one of the lowest in the country, but a top economist in the state said the recovery has been uneven.
“The numbers indicate that the labor market has stabilized rather than indicating it’s slowing down,” said Eugene Tian, chief economist for the state Department of Business, Economic Development and Tourism. “But there is some challenge in the labor market because it is not evenly developed. Certain industries are doing very well, like construction — I think May is the highest ever in history — but there are some industries that are still struggling.”
The labor force, which includes people who are employed and those who are unemployed but actively seeking work, fell to 688,100 last month from 690,050 in April, according to data released Friday by the state Department of Labor and Industrial Relations.
There were 665,750 people employed in May, down from 668,050 the previous month, while the number unemployed increased to 22,300 from 22,000.
But in another measure of the Hawaii economy, total nonfarm jobs last month rose by 1,100 to 648,300 from 647,200 in April and jumped by 13,700, or 2.2 percent, over the past year. The nonfarm payroll jobs figure includes people who might hold multiple jobs but doesn’t include people who are self-employed.
“Those numbers are an indication that the number of people self-employed decreased because of the payroll increase,” Tian said.
The unemployment rate had been 3.1 percent in both February and March before rising to 3.2 percent in April and then remaining at that level in May.
By comparison, the U.S. unemployment rate was
4.7 percent in May, down from 5.0 percent in April.
Hawaii is tied with North Dakota for the fifth-lowest unemployment rate in the country and trails just South Dakota (2.5 percent), New Hampshire (2.7 percent),
Nebraska (3.0 percent) and Vermont (3.1 percent).
However, Tian said the state’s strong jobless rate masks Hawaii’s underemployment rate, which takes into account so-called “discouraged workers” who are not employed and those people who are working part time when they would prefer to be working full time. Hawaii’s 5.1 percent underemployment is above the national 5.0 percent rate. Hawaii’s underemployment rate from 2005 through 2007 was 3.5 percent, Tian said.
“Although the official unemployment rate is among one of the lowest in the nation, we still have a challenge because the people in Hawaii unemployed due to economic reasons is still high,” he said.
The unemployment rate and nonfarm payroll numbers are derived from separate surveys. Hawaii’s unemployment rate is
derived largely from a monthly telephone survey of households, while a separate survey of businesses determines the number of nonfarm payroll jobs.
The largest increase in nonfarm jobs last month came from the construction sector, which rose over the previous month by 700 workers to 40,700. In May 2015 there were 34,000 construction workers. The leisure and hospitality industry sustained the largest loss in jobs at 1,000, with most of the losses concentrated in food services and drinking establishments. Government employment increased by 2,000 jobs, largely as a result of seasonal fluctuation at the Department of Education.
The state’s lowest unemployment rate dating back to January 1976 — the oldest available data on the U.S. Labor Department website — was 2.4 percent, achieved from October through December 2006 and May through September 1989.
Initial unemployment claims declined during May by 85, or 6.4 percent, from the same time a year ago, while weekly claims dropped by 1,254, or 15.3 percent, over the same time frame. During the month, initial claims dropped 6 percent from April while weekly claims increased 2.5 percent over the same period.
The unemployment rate fell in two of the four major counties from the previous month and remained the same in the two other counties. State and national labor force data are adjusted for seasonal factors, but the county jobs data are not seasonally adjusted and thus do not take into account variations such as the winter holiday and summer vacation seasons.
Hawaii County’s rate dropped to 3.9 percent from 4.0 percent, and Kauai County’s rate fell to 3.4 percent from 3.6 percent. Honolulu County’s rate remained at 2.9 percent while Maui County’s rate stayed at
3.2 percent.
Within Maui County, Maui’s jobless rate remained at 3.0 percent while Molokai’s rate rose to 7.4 percent from 5.9 percent, and Lanai’s rate dropped to 7.3 percent from 9.0 percent.