Economist: Recession in Hawaii will surpass anything we’ve seen ‘in our lifetimes’
HONOLULU, Hawaii (HawaiiNewsNow) - One of Hawaii’s top economists warned residents Monday to prepare for a recession that “will surpass anything we have ever seen in our lifetimes.”
Carl Bonham, director of the Economic Research Organization at the University of Hawaii, made the dire economic prediction in a legislative meeting on the coronavirus pandemic Monday.
He said that Hawaii is already experiencing a deep recession and by the second quarter of the year, unemployment could exceed 20 to 25%.
“This is worse than they ever expected,” said Bonham, adding that the economic pain of the pandemic will outlive the threat from the virus.
“Even if it (the health crisis) passes quickly, it’s going to take an extended period of time for the recovery to previous economic levels. The really disturbing thing about this is that no one can say with any certain how long the recovery will take.”
Bonham’s statements come as layoffs continue to mount in the islands.
More than 116,000 people have filed for unemployment in Hawaii ― just this month. And more big layoffs and furloughs are planned.
Scott Murakami, the Director of the state Labor and Industrial Relations department says unemployment checks are taking longer to go out now, despite increasing staff and improving technology. Before the outbreak, the process took about two weeks, it’s now at least three weeks.
Murakami said there are ways business owners and unions can speed up the process, “Help their members and help their employees file online with us that really is a tremendous help and I think it makes the employee feel comfortable." In particular, workers who don’t have online access.
Those who cannot file using a computer will have to call and make an appointment which causes significant delays. Appointments being taken now are for mid April.
Murakami hopes to get a second call center set up by next Monday to speed up appointments. He agreed with Bonham that the recession will likely outlast the COVID-19 outbreak.
“We’ve never had a situation where we’ve had economic impact from social distancing," Murakami said even after the public health issues, consumers may be afraid to travel to Hawaii.
In an interim forecast released Monday, UHERO said that it expects the state’s non-farm job count will fall by more than 140,000 from its recent peak, approximately a 20% year-over-year decline.
Bonham said there is some good news.
[Read more: Hawaii to get $1.2B in direct cash payments to residents as part of stimulus package]
The federal stimulus package not only includes payments of $1,200 to most Americans, it bolsters unemployment benefits and seeks to help stabilize businesses now operating very much in the red.
U.S. Sen. Brian Schatz, D-Hawaii, has also noted there’s federal relief from evictions or foreclosures for hundreds of millions of Americans. His office has put together an online guide with more information.
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