Employment in Hawaii is showing signs of improvement alongside a national jobless reduction last month.
The U.S. Bureau of Labor Statistics reported Friday that the national unemployment rate dropped to 13.3% in May from 14.7% in April.
Comparable data by state is not yet available, but the U.S. Department of Labor reported Thursday that Hawaii’s unemployment rate had improved to 20.6% in the week ended May 16 from 22.3% in April.
Before the spread of the novel coronavirus resulted in stay-at-home orders and a halt to nonessential business operations, Hawaii’s unemployment rate was under 3% and one of the lowest in the country.
Hawaii’s unemployment rate in April was third worst among states, behind Nevada at 28.2% and Michigan at 22.7%.
Workers in Hawaii also have had some of the biggest difficulties receiving unemployment checks, because the state’s computer system for claims wasn’t equipped to handle incredibly high volume.
The state Department of Labor and Industrial Relations produced a series of workaround solutions over the past few months to ease a claim backlog that still persists, and said on Friday that it has paid out nearly $1 billion in benefits from May through Thursday, including standard state unemployment checks, a federal bonus and special federal payments for the self-employed and other nontraditional workers.
Gradual improvement in employment is expected to continue this month and in subsequent months as more Hawaii businesses shuttered in response to COVID-19 reopen with government permission.
Improvement locally, however, could be slower than many other states that have been more aggressive with reopening plans despite COVID-19 case volumes that haven’t declined as consistently as cases in Hawaii.
On Friday, Oahu restaurants were allowed to resume dine-in service with new capacity limits to practice social distancing.
A more dramatic and quicker rebound for employment in Hawaii isn’t anticipated because restrictions on tourism — the biggest single contributor to the state’s economy — have yet to be lifted.
As a result, most hotels remain closed and many other businesses highly dependent on visitors — including transportation companies, attractions, retailers and restaurants — are hard-pressed to bring back employees.
Local fashion retailer Jams World shuttered its six Hawaii stores in March, and brought back relatively few workers in April to continue factory operations and online sales that included a line of face masks.
Nonessential retailers were allowed to reopen last month, but leaders of the company can’t envision reopening and rehiring the vast majority of workers until the lockdown on tourism is lifted.
“Our stores are in resort areas,” said Lei Rowan, Jams World retail director. “We are hoping to come back as soon as possible.”
As of Friday, local government leaders had not determined when or how tourism will be allowed to resume.
Eugene Tian, chief economist with the state Department of Business, Economic Development and Tourism, said last month that he expected Hawaii’s unemployment rate for May and June would improve because of businesses rehiring as they reopen or receive forgivable federal Paycheck Protection Program loans.
According to an Associated Press story Friday, national job gains in May were stronger than some economists had predicted as reopened businesses recalled workers.
The Bureau of Labor Statistics report said national employment got the biggest boosts from the food and drink services sector, where employment rose by 1.4 million in May after the industry shed 6.1 million jobs in March and April.
Leisure and hospitality jobs rose the next most, up 1.2 million nationwide after falling by about 8.7 million in March and April.
Other notable gains nationally were made in apparel retailing, automobile dealers, general merchandise stores, dentistry and social assistance job categories.
“These improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus pandemic and efforts to contain it,” the report said.