Also, they believe that once the Hawaiian economy improves, so too will the welfare picture. If you have slow economic growth and unemployment is high, you wouldn't expect the welfare rolls to go down. In June, the unemployment rate in Hawaii stood at 6.6 percent of the work force, about 2 percentage points above the national average. That state jobless rate is up from last December, when it stood at 5.1 percent. The sluggishness is part of Hawaii's almost dual economy with Japan.
High unemployment is a good predictor of welfare rolls.
For the next three years, benefits drop 10 percent annually, after which recipients drop off the rolls. While the old welfare system reduced benefits dollar for dollar for what a recipient received from a part-time job, PONO allows recipients to keep a larger share of their welfare checks if they work. In the first two years of a reduced benefits check, a recipient has to work only 7.5 hours a week at the minimum wage to make up the difference, meaning that even with just part-time work, a family can end up with a higher income than provided at the top end of the welfare scale. Stanley said the difference between Hawaii's reforms and those of most states partly explains the continuing increase in rolls here. Other states changed the eligibility for benefits and their economies can support the jobs required for that kind of reform.