Hawaii Economic Outlook June 2021

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By: T. Jeffersonian

The May 2021 jobs report is due at the end of the week.  Expected is the announcement that nearly 674,000 jobs were created.  If this report is true, the news follows a disappointing April report that put Democrats in disbelief.  Democrats could not comprehend why the Rescue Plan Act plus vaccinations failed to create more jobs. 

Here in Hawaii, with school out for the summer, this is historically the time of year when people should be lining up to fill out applications.  Indeed, certain businesses are thriving, while others think they are being used to tick a box on unemployment paperwork.  It is probably a combination of summer application increases and the unemployment requirement causing Hawaii businesses to now see at least a 25 percent increase in applicant flow.

Hawaii construction is thriving right now. The transportation, warehouse, and clerical work are all reporting increases.  Still retailers and restaurants are struggling to fill positions.  These were the first businesses shut down during the pandemic.  Having to largely do without this income has made employees find other means to make money and survive.  Employees are being called back but some of them already found other employment.

Traditional retail and restaurant workers may not ever entirely trust going back.  Last summer there was a surge.  There are still a lot of Covid 19 variants out there.  There is still a lot of conflicting news out there plus daily reports about other countries continuing to lockdown again.  People are playing all the environmental factors cautiously.

What is known is that the unemployed can continue to collect unemployment until September 2021.  Collecting unemployment is currently a more reliable and safer option for non-essential workers.  Given last year’s up and down and given the general sense of Covid 19 fatigue, people are simply tired of worrying and wondering how long will this last.  The Democrats are still paying people to stay home.  This is all delaying recovery because people with smaller resumes are not properly incentivized to return to work.

Another delay here in Hawaii is lack of normal childcare.  Businesses are opening before childcare is opening.  People are staying home to take care of the kids.  Schools are projected to reopen to full in person learning in the Fall.

Hawaii is now asking employers to flag applicants who do not show up for interviews.  Armed with this information, the state intends to clamp down on people intending to exploit loopholes in the unemployment system.   The Democrats are also cracking down on gig workers who typically receive cash payments with no supporting tax documents.  These payments together with unemployment can equate to higher wages than what a person received before the pandemic. Democrats would have you believe their gig worker crackdowns are intended to ensure that employers provide benefits and higher wages.  This is not true.  Democrats cannot pay for unemployment forever and they need tax revenue to pay for their vast pay-for-votes recovery schemes. 

We are going to see a job reports of about 600,000 for May.  This will give a slight economic bounce across the country, but it will not last long.  Because of our geographic isolation, Hawaii’s return to economic normalcy will lag about 30 days behind the mainland.  Following the poor April jobs report, the stock market in May was up and down.  Historically, over the past twenty years, the stock market in June has only increased 40 percent of the time.  June is a lukewarm stock month. 

The May jobs report, rising gas prices, continued unemployment benefits, plus the June stock market malaise is going to make Democrats again scratch their heads.  As a default reaction, they will resort to another spectacular economic program roll-out, such as infrastructure, to bail them out and keep their approval ratings high. This is all smoke and mirrors though.  The Democrats do not comprehend how the pandemic has changed the economic landscape.  Without taking from one group and giving the money to another, the Democrats have never demonstrated the ability to create wealth across all classes so all boats can rise on the creating economic tide.  The Democrats will continue to divide the public by vilifying the wealthy and emphasizing multiculturalism to justify raising taxes.