UHERO forecasts troubling outlook for Hawaiʻi’s workforce

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scenic view of Honolulu

Due to the ongoing COVID-19 pandemic, University of Hawaiʻi Economic Research Organization (UHERO) researchers estimate that the state’s total employment rate, as well as its unemployment rate, will not return to its pre-pandemic level until 2029, putting the attention on social safety net programs, and job re-training and education programs.

According to a new UHERO report, the state’s unemployment rate was one of the lowest in the U.S. a year ago, and its underemployment rate was near the national average. Now, both rates are significantly higher.

UHERO researchers in UH Mānoa’s College of Social Sciences said Hawaiʻi’s unemployment rate in 2019 was 2.8 percent, the sixth lowest nationwide. However, it’s “U-6” rate, the broadest measure of underemployment, was about 7 percent, with just 23 other states having a lower U-6 rate. The U-6 rate factors in those who are unemployed, with residents who are employed part-time who would rather work full-time, and those who are neither working nor currently looking for a job but say they want and are available for a job.

COVID-19 workforce effects

In March 2020, before the economic effects of the COVID-19 pandemic were felt in the state, the unemployment rate was 2.4 percent. In April, the rate climbed to 23.8 percent and dropped slightly to 22.6 percent in May.

To compare the current situation with the Great Recession of 2007–09, UHERO analyzed Bureau of Labor Statistics (BLS) data and discovered that while the unemployment rate jumped by about 3 percent from 2008–10, there was a large spike in the number of involuntary part-time workers from 24,600 to 51,400 during the same period. These residents are still counted as employed, however, while they still held onto their jobs, many reluctantly settled for part-time employment.

UHERO recommends analyzing the BLS’s labor underutilization statistics and not just the unemployment rate to gain a complete understanding of Hawaiʻi’s workforce situation. UHERO said after the Great Recession—which did not have travel quarantines, business shutdowns and stay-at-home orders—employment in Hawaiʻi did not return to pre-recession levels until 2014.

View the full report on UHERO’s website.

Author: Admin