The number of Americans applying for unemployment benefits fell last week, with the last weekly total of initial applications falling below 800,000.
While some states have seen unemployment claims drop from record levels after the coronavirus pandemic has clouded the US job picture, one state stands out for how dramatic its return was.
After instituting a mandatory “safe travel” test program for travelers in October, the country’s leading unemployment rate in Hawaii has plummeted from more than 20% to less than half in a matter of months. According to the latest weekly data from the Department of Labor, Hawaii went from leading the country with an insured unemployment rate of 21.3% in September to not even being ranked among the top 10 states with rates above 4.9% .
It is proof of a point repeatedly made by Federal Reserve Chairman Jerome Powell, over and over again – that any economic recovery will be inextricably linked to controlling the pandemic. As Hawaii’s Lieutenant Governor Josh Green, who also works on the island as a doctor, told Yahoo Finance Live this week, the state’s Safe Travels program has allowed Hawaii to open safely and steadily.
“We went from a disastrous situation to, well, let’s just say, a less disastrous situation, improving every week,” he said on Monday, noting a giant drop in new daily cases from around 300 in January to around 100 in early February. With just over 28 COVID-19 deaths per 100,000 people, Hawaii is tied with Vermont for the lowest number of deaths in any state, adjusted for the population.
Since October 15, the state’s Safe Travels program has required travelers to submit a negative COVID-19 test. After a few hiccups with the tests, the program was successful, with travel continually returning to the state of Aloha.
“Suddenly, our numbers went from nothing to 10,000 or even 15,000 a day, which was somewhere between 35% and 50% of our baseline,” said Green, adding that the state is actively working with technology partners to create a vaccine passport program to also streamline travel for vaccinated travelers.
“This will be important for us until 2021, 2022. It will drive economic growth and recovery, he said. “We need to get back to a larger part of our travelers. We used to receive 30,000 a day or 900,000 a month, we will have to be more secure and that will be one way to do that. “
Of course, Hawaii is different from other states on the continent in that it is able to block travel more easily because it is its own island. But given the strength of Hawaii’s recovery, it is hard not to imagine what form the United States could be in as a nation if equally stringent measures were taken earlier at the national level. Green thinks the data shows that the Hawaii program could have helped.
“If we had essentially done a safe travel program nationwide, we could have reduced the number of cases received by about 80%,” he said.
Given Hawaii’s most severe increase in unemployment in early 2020, it could be argued that an equally stringent national blockade would have plunged the US into even worse unemployment to overcome. On the other hand, extrapolating the case study from Hawaii to the country as a whole is a little difficult, as the state’s economy is exclusively leveraged for tourism and, therefore, for tourism-related jobs.
However, considering the improvement and progress that Hawaii has been able to safely implement, its path forward looks much less uncertain than another state similarly leveraged for tourism. Nevada’s 6.1% uninsured unemployment rate remains the third worst in the country, as Las Vegas continues to suffer from a drop in the number of trips. Nevada also had about five times as many population-adjusted COVID-19 deaths, according to data from the Center for Disease Control and Prevention.
“When you compare it to the population of the continent, we should have had 1,600 deaths. We had 25,000 cases. We should have 125,000 cases, ”said Green. “So, the successes are evident in keeping people healthy and safe, but the economic effects have been heavy.”
Zack Guzman is an anchor of Yahoo Finance Live and also a senior writer who covers entrepreneurship, cannabis, startups and breaking news on Yahoo Finance. Follow him on Twitter @zGuz.
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