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Hawaiʻi has yet to recover to pre-pandemic job numbers, report says

File - Downtown Honolulu
HPR
File - Downtown Honolulu

Hawaiʻi is among just a handful of locations in the U.S. that still have fewer jobs than it did before the COVID-19 pandemic.

Louisiana, Maryland and Washington, D.C., are the only other areas in the nation that have yet to recover to their pre-COVID job numbers, according to the latest forecast report from the University of Hawaiʻi's Economic Research Organization.

As of July, the number of payroll jobs in the state was still about 3.5% short of where it was before the pandemic, said UHERO economist Carl Bonham.

That’s even with a nearly recovered tourism industry.

The pandemic brought tourism in Hawaiʻi to a halt, resulting in one of the highest unemployment rates in the country. The UHERO 3rd quarter forecast report said that by mid-2023, visitor numbers were at their pre-pandemic level, and "real tourism spending reached an all-time high. And still, jobs had not recovered.”

The report said that stagnant growth in personal income, along with a declining population, are likely contributors.

“ It's a chicken and an egg problem. You've got to have good jobs for people to be able to make a living, cover the high cost of living, and feel like this is the place they can stay and raise a family and afford housing. If you don't have the workers, you also can't create the jobs,” Bonham said.

UHERO said the inflation-adjusted personal income growth in Hawaiʻi will grow by 1.4% this year and be a little stronger next year, but that it will drop to 1% over the next five years because of the slowing job growth.

An aging population, with fewer children and more seniors leaving the workforce, are contributing to the shrinkage as well, according to the report. However, UHERO found that families don’t want to move to the state, due to a lack of growth in per capita income.

“Hawaiʻi is the standout laggard among states for job growth since the pandemic. Early on, this reflected lagging tourism recovery. Now it simply embodies Hawaiʻi’s chronic underperformance, caused by high relative costs, reliance on low-productivity-growth services, and lack of diversification. Now that is compounded by stagnant or negative population growth,” the report said.

It’s not all bad news. UHERO said that the state’s tourism industry has been resilient in recent years despite the slow recovery on Maui, a year after its deadly fires.

Mark Ladao is a news producer for Hawai'i Public Radio. Contact him at mladao@hawaiipublicradio.org.
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