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Hawaii’s unemployment rate climbed back into double digits in January to retain the dubious honor of having the highest figure in the country.
But with tourism improving and the number of COVID-19 cases per capita the lowest of any state in the country, local economists say the outlook for the state is looking up.
The seasonally adjusted jobless rate in Hawaii was 10.2% in January, slightly down from a revised 10.3% in December, according to data released Monday by the state Department of Labor and Industrial Relations. The December figure was revised upward from the 9.3% previously reported.
“January was not a good month for Hawaii due to the surge in COVID-19 cases in Hawaii and the mainland in January which delayed the opening of businesses and hiring,” Eugene Tian, chief economist for the state Department of Business, Economic Development and Tourism, said in an email. “Average daily visitors to Hawaii was 7,606 per day in December 2020, and dropped to 5,548 in January 2021. Hawaii was the only state with a double-digit unemployment rate in January 2021 and ranked the highest in the nation. The economic recovery is falling behind the nation.”
DLIR revisions, which are conducted each March, show that Hawaii fell to an all-time low seasonally adjusted unemployment rate of 2.0% in January 2020 and then soared to an all-time high of 21.9% in both April and May.
California had the second-worst unemployment rate in January at 9.0%, with New York third at 8.8%. South Dakota and Utah were the lowest at 3.1% apiece, followed by Nebraska and Vermont at 3.2% each. The U.S. jobless rate was 6.3% in January.
Tian said he expects Hawaii’s unemployment rate to drop when the February numbers are released in about two weeks.
“Daily visitor arrivals increased more than 60% in February 2021 as compared with January,” he said. “The daily visitor arrivals was 8,880 in February. For the first 14 days of March, daily visitors was 11,643, a further increase and a 36% recovery from the same month in 2019. According to the DBEDT economic forecast released on March 1, the unemployment rate is projected to be 8.2% in 2021.”
Tian said Honolulu’s move to a less restrictive Tier 3 on Feb. 25 already is paying off.
“We are currently in Tier 3 and we have seen the impact on employment already,” he said. “The initial unemployment claims have been below 3,000 since Honolulu entered Tier 3. With more people getting vaccinated in the state and the nation, it is expected that by July this year, businesses will be fully open, tourism recovery will be faster and the unemployment rate will drop significantly during the second half of 2021.”
The state’s labor force. which includes those who are employed, those who are unemployed but actively seeking work and those who are self-employed, slipped in December to 655,050 from 655,600. The number of people employed fell to 588,050 from 588,150. Those unemployed declined to 67,000 from 67,400. Labor force data are compiled from a telephone survey of households.
Nonagricultural payroll jobs, which are calculated from a mail survey of employers and are a better indicator of job growth because of a larger sample size, decreased 1,500 from December but were down 122,100, or 18.4%, from the same time a year ago.
OUT OF WORK
Hawaii’s monthly seasonally adjusted unemployment rates since the beginning of 2020:
MONTH RATE
January 2020 2.0%
February 2020 2.1%
March 2020 2.1%
April 21.9%
May 21.9%
June 14.1%
July 14.1%
August 14.1%
September 14.8%
October 14.0%
November 10.3%
December 10.3%
January 10.2%
Source: State Department of Labor and Industrial Relations
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