Editorial: Save businesses before it’s too late

It would be a happier Labor Day, if there could be more labor. And the fact that Oahu is under a stay-at-home order, precluding the traditional beach bashes, casts a pall over this end-of-summer holiday.

The malaise goes even deeper than that, sadly. Hawaii’s businesses, and its workforce, are already in a world of hurt and foreseeable prospects don’t look very hopeful. This heightens all the more the imperative for state and county officials to get aid out the door to those in need.

The deficit in household finances is painful and growing more intense. Even the promise of a limited federal supplement to state unemployment benefits — replacing the $600 “plus-up” tacked onto unemployment checks through July — seems a distant source of relief.

That $300 weekly add-on for four weeks is coming from nearly $200 million in Federal Emergency Management Agency funds. Distribution requires the development of a separate state application and delivery system, something that never emerges very quickly.

Further, the Pandemic Unemployment Assistance program, meant for sole proprietors and others disqualified for regular unemployment benefits, has bogged down as the state worked to counter the initial rush of fraudulent claims that were processed too quickly.

The unemployment crisis caused by the pandemic has cost many people their jobs, and some soon must apply for extended benefits. On Thursday, the state Department of Labor and Industrial Relations reported paying out nearly $3 billion in claims since the pandemic hit March 1. Almost 183,000 claims were deemed valid, and 11,000 are still pending.

That adds up to enormous financial struggle for Hawaii families, and many employers sense they won’t be able to hang on much longer, either.

Dozens of companies are signaling that layoffs or long furloughs are in the offing. The federal Worker Adjustment and Retraining Notification (WARN) Act requires employers with 100 or more workers (excluding those with less than six months on the job) to provide at least 60 days notice of a significant closure or work disruption affecting 50 or more employees.

The law also requires that states be alerted; a list of these filings can be seen on the DLIR website (labor.hawaii.gov/wdc/real-time-warn-updates). Starting from March, the site lists 165 Hawaii company filings — 88 since June. When special federal support programs such as the Paycheck Protection Program began to wane, signs of distress accelerated.

Many of these companies, tied to the visitor industry, have flagging confidence in the restart of tourism. And this doesn’t even count smaller businesses that survive on thin margins in the best of times.

Economists worry, with reason, that business closures mean not only the loss of jobs but the loss of business institutional memory, contacts and skills, as the jobless move away. These are assets not easily recovered.

This looming decline should send yet another signal to state, county and federal leaders that time is running out for salvaging the remaining businesses.

Money in the federal CARES Act resources must be deployed, everything from funds for nonprofits providing immediate support, to job retraining programs for the long-term recovery.

The call for further congressional aid must grow louder, too — loud enough to overcome political barriers to compromise, nearly insurmountable in an election year.

For now, families must salvage what enjoyment they can in each other’s company, even if that’s limited to household members in the back yard. There still could be some Labor Day triumph, if government leaders pull together and do some of the difficult labor expected of them.