REPORT: Hawai‘i Wages Lower Than U.S. Average

The Department of Business, Economic Development and Tourism (DBEDT) released “Hawaii’s Working Population: An Analysis by Industry 2012-2016” on Tuesday, April 10, 2018, which shows the general demographic, social and economic characteristics of Hawai‘i working population by industry.

“The report shows the structure of our industry from the employment perspective,” said DBEDT Director Luis P. Salaveria. “The top two industries, Accommodation and Food Services and Retail Trade, are closely related to tourism and employed one-fourth of our total working population. It is encouraging that Hawai‘i employees in the Accommodation and Food Services sector were paid better than their counterparts in the nation.”

Hawai‘i’s average labor earnings and wages, in general, are lower than the U.S. average. Females made less income than males in almost all the industries.

“The analysis in this report may be helpful for those planning to enter the labor market,” said Chief State Economist Dr. Eugene Tian. “However, most of the statistics are averages for the industry combining all the occupations. We are working on another analysis looking at the characteristics of Hawaii’s working population by occupation.”

REPORT HIGHLIGHTS

Employment

Employment is measured by number of persons working either full-time or part-time, receiving a paycheck (payroll) or self-employed.

The major industry structure difference between Hawai‘i and the U.S., in terms of employment, lies in tourism and manufacturing. The top three industries with the largest employment for the U.S. were Healthcare and Social Assistance (13.8%), Retail Trade (11.5%), and Manufacturing (10.4%). In contrast, the top three industries in Hawai‘i were Accommodation and Food Services (13.6%), Retail Trade (11.7%), and Healthcare and Social Assistance (11.2%).

The male to female ratio in Hawai‘i’s workforce was 51.9 males to 48.1 females per 100 workers during the 2012-16 period. The Construction sector was the top industry dominated by male workers at 89.8% versus 10.2% female workers. The Health Care and Social Assistance sector had the largest share of female workers at 73.3%.

Among the working population in Hawai‘i, millennials (born 1981-98) accounted for one third (33.2%), Generation X (born 1965 to 1980) accounted for 37.3%, Baby Boomers (born 1946 to 1964) accounted for 28.3%, and the Silent Generation (born 1928 to 1945) and the Greatest Generation (born 1915-1927) combined accounted for 1.1% of the total work force during the 2012-16 period.

Due to the large number of Asians in Hawai‘i, Asians were the largest ethnic group for all the industry sectors except Art, Entertainment & Recreation where White was the dominating ethnic group.

Educational Services, Professional, Scientific & Technical Services, Finance & Insurance, Health Care & Social Assistance, Public Administration, and Information sectors hired more workers with at least a bachelor’s degree. On the other hand, Agriculture, Construction, Waste Management, Retail Trade, and Accommodations and Food Services hired more workers with lower education levels.

The report shows 78% of workers had full-time jobs, 22% of workers had part-time jobs during the 2012-16 period. The Public Administration sector had the highest percentage of full-time workers at 96.2% while Arts, Entertainment and Recreation industry had the largest percentage share of part-time workers at 40.9%.

Total workers in the state were wage and salary (payroll) workers at 89.5%, with the remaining 10.5% listed as self-employed proprietors during the 2012-16 period.

Labor Earnings

Labor earning is measured by income earned as wage and salary and proprietor’s income, including both full-time and part-time working people.

The top paying industry in the country was Professional, Scientific and Technical Services sector, with an average annual labor earning of $80,833. People in the same industry in Hawai‘i earned 82% of the U.S. average labor earning. The top industry with the highest labor earning in Hawai‘i was Utilities ($70,576).

In most industries, the U.S. average labor earnings were higher than those of Hawai‘i. However, there were a few industries where Hawai‘i’s average labor earnings were higher than the U.S. averages. These industries included Accommodation and Food Services ($9,630 higher than the U.S. average), Construction ($7,915 higher) and Health Care and Social Assistance ($7,312 higher).

The state average labor earning for male workers was $51,566, which was $12,921 higher than the average labor earning for female workers ($38,645). Male workers earned more on average than females in all the industries except Agriculture, Forestry, Fishing and Hunting, where female workers earned more than males ($42,762 for female and $33,872 for male).

In general, average labor earnings increased with age up until the Baby Boomers age (52-70 years of age during the 2012-16 period). In all the industry sectors, Generation X had higher average earnings than Millennials.

Average labor earnings for those in the White race group alone were higher than other major race groups in all the industry sectors except Art, Entertainment & Recreation, where Asians had higher average labor earning at $32,771, higher than that of White alone at $31,612.

The average labor earnings had a close positive relationship with education level. The higher the education level, the higher the earnings and this was true for all the industry sectors.

Overall for all the industries, full-time workers had $52,907 average labor earning and part-time workers had an average labor earning of $18,591. Full-time workers in Professional, Scientific and Technical Services had the highest average labor earning at $75,889 per year. Full-time workers in Accommodation and Food Services had the lowest average labor earning at $37,591 per year during the 2012-16 period.

The state average labor earning for payroll (wage and salary) workers was $44,584 per year, including full-time and part-time workers during the 2012-2016 period. Self-employed workers made more money on average than payroll workers. The average labor earning for self-employed workers was $51,868 per year, 16.3% higher than that of payroll workers.

Wages of Full-Time Payroll Employees

Wage is measured by wage and salaries of employees receiving paychecks from employers. A full-time worker is someone who works at least 35 hours a week.

Overall, the industry average wage of full-time payroll workers was $51,347 for Hawai‘i, lower than the U.S. average of $54,840 during the 2012-16 period. In other words, Hawai‘i’s average wage for full-time payroll workers was 93.6% of the U.S. average.

U.S. average wages were higher than Hawai‘i in most of the industry sectors, except Agriculture, Forestry, Fishing & Hunting, Construction, Transportation & Warehousing, Administration & Support & Waste Management Services, Health Care & Social Assistance, and Accommodation & Food Services.

Among the full-time payroll workers in Hawai‘i and for all the industry sectors combined, male employees had an average annual wage of $55,925, about $10,000 higher than female workers at $45,948.

An average male worker earned more wage than an average female worker for all industry sectors except Agriculture, Forestry, Fishing & Hunting, where an average female worker earned more than an average male worker.

The average wage increased with age, especially up to the Baby Boomer’s age, for most of the industry sectors. This indicates that experience did play an important role in the wage level.

Whites had the highest average wage compared with other major racial groups during the 2012-16 period. The average wage for Whites was the highest at every industry sector.

The average wage increased with educational level for every industry sector. The average annual wage for those with an associate degree and some college was 23.2% higher than those with a high school diploma or lower. Workers with at least a bachelor’s degree had an average annual wage of $67,680, 44.7% higher than those with an associate’s degree, and 78.2% higher than those with high school diploma.

The statistics in the report are based on the data from the U.S. Census Bureau’s 2012-16 American Community Survey, and this data set is the latest available.

The report can be downloaded here.