Hawaii’s economy may be in a good place, according to Carl Bonham, director of the University of Hawaii Economic Research Organization (UHERO). However, any employer looking to fill open positions will tell you it is tough to find workers.
Maui is not alone in suffering from lack of workforce. Low unemployment is affecting all counties in Hawaii. Maui’s low point came at the end of 2017 when the unemployment was 2.2 percent. It has now risen to 3.1 percent according to UHERO data. That figure is still low.
Bonham said the good news is that Maui County has led the state in job growth. In the lean years of 2007 to 2010, Maui County suffered an 11 percent loss of jobs, the worst in the state. But Bonham said the county has led the state in job growth since. By 2018, jobs grew by about 20 percent.
While low unemployment and record-breaking visitation numbers year after year can be good indicators for the economy, the current labor market has many employers scrambling for help.
The problems for Hawaii’s employers:
- With so few people looking for work, Hawaii’s employers are having a difficult time filling positions with qualified employees. Young people are leaving the state in search of better job opportunities which is decreasing the unemployment rate but making it even harder for employers to hire employees. Our own company utilizes constant recruitment to try and avoid labor gaps. See our online application here.
- The state’s demographics are also a factor- an aging population retiring from the workforce is not being replaced by enough working-aged job seekers.
The problems for Hawaii’s workers:
- The cost of housing has increased, meaning many employees do not make enough money to live on, or a “living wage.”
- People are under-employed, cobbling together two or three part-time jobs to make ends meet, when they would like one higher paying full-time job.
- People who have given up looking for work or chosen to go back to school because they don’t have the skills that meet employer needs.
Overall economic picture
Tourism and the U.S. military are the significant drivers of Hawaii’s $92 billion economy. Hawaii has one of the most onerous business tax situations. Another drawback: the highest cost of living in the U.S. Hawaii’s median home price of $708,000 is $115,000 more than any other state, and some of the highest rental rates in the nation.
A thriving economy depends significantly on worker productivity and consumer spending. Factors affecting the economy include sluggish tourism spending, less spending on consumer goods by underemployed workers, Hawaii jobs going unfilled due to an extremely low unemployment rate and workers leaving the state.
Even Bonham agrees the economy is flattening as success factors, such as low unemployment, become limitations. State economist Eugene Tian projects a slower rate of economic growth for Hawaii in 2019 of 1.2 percent. In comparison, the average annual growth rate in Hawaii over the past 30 years has been 1.8 percent.
On a positive note, there is some wage growth that helps workers, and ultimately the economy.