Hawaii’s unemployment rate dipped 1 percentage point in December to 3.2%, its lowest level since before the pandemic, as the number of people in the state labor force decreased from the previous month.

The last time the seasonally adjusted jobless rate was lower was in March 2020, when it hit 2.2%. In April 2020 the unemployment rate spiked to 22.4%.

Hawaii’s rate in December was better than the U.S. rate, which came in at 3.5%.

Nonfarm payroll jobs fell by 3,400 in December over November, with the leisure and hospitality sector losing 4,800 positions to more than offset job gains in other categories.

Hawaii’s labor force, which includes those who are employed, those who are unemployed but actively seeking work and those who are self- employed, dipped to 672,300 in December from 674,350 in November. Those employed fell to 651,000 from 652,400 the previous month. However, the number of people unemployed declined to 21,300 from 21,950.

Nonfarm payroll jobs are calculated from a mail survey of employers and are considered a better indicator of job growth due to a larger sample size than the labor force data, which is compiled from a telephone survey of households. In the payroll count, one person might be counted multiple times if that person has multiple jobs.

The jobless rate fell in the state’s four major counties in December from November. State and national labor force data is adjusted for seasonal factors, but the county jobs data does not take into account variations such as the winter holiday and summer vacation seasons.

Honolulu County’s jobless rate fell to 3.4% from 3.8%, Hawaii County’s rate dropped to 3.8% from 4.1%, Kauai County’s rate decreased to 4.0% from 4.3% and Maui County’s rate sank to 3.8% from 4.2%. In Maui County, Maui’s rate fell to 3.8% from 4.2%, and Molokai’s rate dropped to 4.4% from 6.8%. Lanai’s rate rose to 1.3% from 1.1%.