Isle jobless rate State unemployment declined to a two-year low of 3.8 percent last month as employers hired more help for the holidays and the economy continued to rebound from the 9/11 terrorist attacks, the Hawaii Department of Labor & Industrial Relations reported yesterday.
at 2-year low
State unemployment declined
to 3.8 percent last month, but
the work force is diminishingBy Dave Segal
dsegal@starbulletin.comThe last time the rate was lower was in December 2000 when it reached 3.6 percent on the heels of the bull market. Prior to that, the unemployment rate had not hit 3.8 percent or lower since March 1992.
But even though the jobless rate was down two-tenths of a point from November and significantly below the 5 percent rate of December 2001, the work force is shrinking. Last month's total labor force, which includes employed and unemployed workers, was 594,300, down fractionally from 594,550 in November and off 2.5 percent from 609,750 a year earlier.
"2000 was just a banner year in job creation and a lot of other variables," said economist Leroy Laney, a professor of economics and finance at Hawaii Pacific University. "Tourism was stronger, the U.S. economy hadn't weakened yet and the stock market hadn't started its real nose dive.
"But I'm not surprised to see the unemployment rate drop from (December) 2001 because the economy is in recovery from 9/11, and there could have been more dropouts from the labor force. They're referred to as discouraged workers, and I've heard anecdotally that what's going on is that people who couldn't find a job simply dropped out."
Still, Hawaii's unemployment rate is lower than the national non-seasonally adjusted 5.7 percent rate.
"One of the reasons for the higher U.S. rate is very anemic job creation over the course of the year," Laney said. "Until we see improvement in the labor market, more job hiring and a lower unemployment rate, we're not likely to see a sustained robust recovery in the U.S. economy."
Meanwhile, Hawaii's seasonally adjusted unemployment rate actually rose from November to December, climbing to 4.2 percent from 3.9 percent. In December 2001 it was 5.6 percent.
The seasonally adjusted rate, which is not typically released by the state Department of Labor, is regarded by economists as a better gauge of the employment picture since it takes out the effects of changes associated with the seasons, such as teachers being out of school. The national jobless rate, which is always released as a seasonally adjusted rate, was 6 percent in December.
"What the seasonally adjusted rate for Hawaii is telling us is that the labor market isn't as good as it might appear," Laney said. "If you adjust for the seasonal holiday hiring season and the unemployment rate goes up, that means the holiday hiring accounted for the improvement."
A breakdown of Hawaii's employment hiring in December showed that business services expanded by 1,400 jobs as temporary employment firms hired replacements for the striking nurses and seasonal retail workers. The hospital sector contracted by 1,900 jobs due to the strike.
Retail trade employment, accounting for much of the seasonal hiring, rose by 1,800 jobs. Employment in government increased by 1,800 jobs, with seasonal work at the Department of Education and the University of Hawaii comprising the bulk of the gains in state government.
The unemployment picture was mixed for the islands, with Oahu posting the lowest jobless rate at 3.4 percent, down from 3.6 percent last month and 4.6 percent a year earlier.
Among the neighbor islands, the Big Island jobless rate was 5 percent, down from 5.2 percent last month and 6 percent a year ago. Kauai was at 5.2 percent, up from 5 percent last month but down from 6.5 percent a year ago. Maui was at 3.9 percent, down from 4 percent last month and 5.9 percent a year ago. Molokai was at 6.8 percent, down from 7.5 percent last month but higher than 6 percent a year ago. And Lanai was at 3.9 percent, down from 4.4 percent last month and 4 percent a year ago.
