On this Labor Day 2024, Hawaii and the U.S. are more focused on labor than is typical in a period of statistically high employment and economic strength. About time.
Chalk it up to the fact that it’s a presidential election year, and the security or lack thereof experienced by working voters can tip results one way or the other. But also, it’s a fact that the proportionate number of households with at least one full-time worker but largely living paycheck to paycheck is growing, while the share of households earning a comfortable middle-class income dwindles.
Hawaii’s workers plainly share nationwide concerns over a rising cost of living, a crisis-level shortage of affordable housing and a too-short supply of well-paying jobs. About 33% of Hawaii’s households are “asset limited, income constrained and employed” (ALICE) — not considered “poor,” yet unable to afford all basic expenses in the communities where they live. These households include the workers who serve meals, stock groceries, sell hardware and maintain office buildings throughout Hawaii. And then there are the innumerable households who scrape by on paychecks above ALICE levels — the “workforce” of health-care providers, first responders, teachers and early-career professionals who find themselves locked out of Hawaii’s housing market, and who are often among those who leave Hawaii in search of a more sustainable way of life.
Statewide policies to address these pressures affecting Hawaii’s workers are essential to ending the exodus among those born and raised in Hawaii, and to retain the workers essential to Hawaii’s idea of itself as a hospitable, generous island state. There has been progress, but more is needed.
>> Hawaii enacted historic tax cuts to benefit working families in June, increasing the state’s standard deduction over seven years, and amending tax brackets to eliminate taxes on lower incomes and also lower tax rates for all brackets. As a result, a family of four earning the median income of $88,000 will take home an additional $3,613 in pay by 2031 — valuable extra help for workforce families.
>> The state’s minimum wage was increased in 2022, after years of agitation, and will rise to $18 hourly by 2028. This wage still falls short, however. At $14 until Jan 1, 2026, when it rises to $16, it fails to reach a minimum floor of $15.53 hourly required to meet basic essential expenses for a single worker — at 2018 prices. Before 2028, Hawaii’s Legislature should revisit the state’s minimum wage, and revise it upward to reflect reality.
>> On a national level, the federal Child Tax Credit was made available to more families by increasing income limits for qualification. But Hawaii lags in this crucial area. In 2023, legislation increased the gross amount of dependent-care expenses that can be claimed, raising it from $2,400 for one dependent to $10,000. But the percentage of this expense remains capped at 25% for those earning less than $25,000 annually, and 15% for those earning more than $50,000. The Hawaii Children’s Action Network recommends raising that cap to 50% for families of four earning less than $150,000 yearly, a move that would provide the most benefit to median-income and ALICE families. Legislation to accomplish this failed to pass this year, and must be reconsidered in the upcoming legislative session.
>> A program to build affordable housing for teachers and school staffers is finally getting off the ground, with a project on the Mililani High School campus that is the first in decades, supervised by the School Facilities Authority. It will create 109 affordable homes — tripling the current supply of 51 rural cottages. So far, $50 million has been allocated for educator housing, and more construction — and funding — is called for.
The state must continue supporting its working families, as private-sector actions alone will not solve these problems. The return on investment is priceless — improved well-being for all of Hawaii’s communities, and a more stable, healthy state.
