Steady job growth and the return of tourists spurred a modest Kauai economic recovery
Kauai’s economy faced several setbacks near the end of its second year of the COVID-19 pandemic, as COVID-19 variants Delta and Omicron delayed its full recovery. New infection cases of the Omicron variant surged, establishing new record daily highs. Kauai County’s positivity rate for COVID-19 rose to 18.9% at the end of January 2022, the highest among the four primary Hawaiian islands. While there is optimism that we are past the worst of the Omicron infections, there remains uncertainty as to whether another variant will emerge to take its place. Kauai’s businesses must remain resilient despite the potential for additional hurdles.
One of the broadest measures of the status of Kauai’s economy is its unemployment rate. Since the government-mandated economic closure in April 2020, Kauai’s unemployment rate, which spiked to 33% in April 2020, steadily improved during the past year. The 6.7% December 2021 jobless rate fell to its lowest level since the pandemic’s emergence.
Kauai’s employers were slow to rehire workers lost at the outset of the pandemic. Of the 8,000 positions cut from payrolls between March 2020 and April 2020, only 1,600 unemployed regained their jobs. Moreover, job counts for all major job categories remain below their March 2020 levels, and only the education sector replaced all the workers that were initially lost. Not surprisingly, challenging conditions persist for Kauai’s retail sector, which still maintains a 2,800 jobs deficit from March 2020 levels. Similarly, the hotel sector’s job count remains 1,600 below March 2020 levels.