LIHU‘E — The governor’s three-day furlough for state workers is weeks away, but already state workers are feeling its effects. One Kaua‘i resident, spending some time at the Kukui Grove Center Monday said his daughter is one of the lower-paid
LIHU‘E — The governor’s three-day furlough for state workers is weeks away, but already state workers are feeling its effects.
One Kaua‘i resident, spending some time at the Kukui Grove Center Monday said his daughter is one of the lower-paid state workers and already is contemplating how to make up the approximately $350 per month that will be missing in her paycheck come July 1.
Many similar stories are circulating in communities around the state — one young family missing its opportunity to own its first home after the bank disallowed the mortgage based on the reduced income following the implementation of the three-day furlough.
Conversations with state workers on the island included discussion of pay cuts ranging from $350 per month on the low side (employees making $30,000 annually) to more than $1,000 per month on the high side (employees making $85,000 and more).
Randy Perreira, executive director of the Hawai‘i Government Employees Association, said each employee faces a pay cut of nearly 14 percent. In a press release, HGEA joined with the AFSCME Local 152 and the AFL-CIO to file for a permanent injunction to block Gov. Linda Lingle’s plan to impose a three-day-a-month furlough on state employees.
On Kaua‘i, figures from the Workforce Development indicate there are 30,300 people in the workforce based on unemployment figures for May 2009.
Of those, a United States Census Community Survey conducted in 2008 claims 12 percent of Kaua‘i’s labor force is spread out between the Federal, state and county, meaning more than 3,600 workers are on government payrolls.
The county’s Web site claims there are 1,050 county employees, leaving more than 2,500 workers on Kaua‘i in the employ of Federal and state governments.
Lingle spokesman Russell Pang said in a voicemail message there are approximately 650 state workers on Kaua‘i that will be affected by the furlough, which was outlined at a Thursday press conference.
Under the plan, the state will save $688 million over two years. Presumably the savings will come from furloughing 15,600 workers statewide and also cutting the budgets of state agencies not under Lingle’s direct control, like the Department of Education, University of Hawai‘i, the Judiciary, the Legislature and the Office of Hawaiian Affairs, by an amount equivalent to the three-day-per-month furlough, as outlined in a press release.
If Kaua‘i’s share of the total savings is the same as its share of furloughed employees — 650 out of 15,600 — the plan would cut Kaua‘i’s local economy by nearly $29 million over the two-year proposal, equivalent to a loss of $1.2 million per month.
If, however, Kaua‘i’s state workers make less than their brothers and sisters across Hawai‘i, or the budget cuts that will likely make up more than half of the $688 million figure do not impact Kaua‘i as dramatically as do the furloughs, the economic impact on Kaua‘i could be markedly less.
Pang said this week that island-by-island economic impact numbers were not available.
Overall real personal income will decline 2.7 percent this year and 0.6 percent in 2010, states the University of Hawai‘i Economic Research Organization’s quarterly forecast update, “State Budget Crisis Threatens Recovery.”
The report said the H1N1 flu epidemic worsened prospects for Japanese tourism which will lead to somewhat larger visitor losses this year, but the bigger concern is fallout from the state fiscal crisis. Government actions to address the growing revenue shortfall will further depress jobs and especially income this year and next, with the risk that recovery could further be delayed.
The furloughs will lead to some additional private sector job and income losses as state workers cut back on spending, the UHERO forecast states.
•Dennis Fujimoto, photographer and staff writer, can be reached at 245-3681 (ext. 253) or dfujimoto@kauaipubco.com
