In March, even before government officials started issuing stay-at-home orders for Hawaii, people were already starting to do just that. Cell phone data indicating customer traffic in places like shops and restaurants already showed people were staying away.

In the days before Gov. David Ige announced a stay-at-home order on March 23, there was about 40% less activity at retail and recreational establishments than in January, mobile phone data from Google shows.

People took it seriously and stayed home.

Now, nearly five months later, as shutdown orders have been eased and the virus is spreading out of control, people are starting to go out and about again.

And that’s worrying some economists who say more restrictions like those imposed by Ige and Honolulu Mayor Kirk Caldwell on Tuesday are necessary to limit activity once again and bring back economic vitality.

Caldwell’s order is aimed at curbing large gatherings and mandates no more than five people can be together at the same time. Most business including restaurants can remain open.

But Ige’s decision to extend a quarantine for tourists and residents returning to the islands at least until October will effectively continue to shut down the state’s largest private employment sector and wipe out jobs for tens of thousands of residents at a time when federal unemployment assistance is mostly tapped out.

Mayor Kirk Caldwell on Tuesday announced prohibitions on social gatherings of more than five people, at home or at businesses on Oahu, as a strategy to stop the spread of COVID-19. However, most businesses, including restaurants, salons and gyms, can remain open. 

As Carl Bonham, executive director of the University of Hawaii Economic Research Organization, puts it: “The virus is the economy.”

It’s not so much that the virus affects the economy directly, said Kevin Lansing, an economist with the Federal Reserve Bank of San Francisco. Rather, COVID-19 can trigger public health responses that impact the economy, and that includes behavioral responses by individuals, he said.

With huge amounts of economic data now available, economists can try to predict these responses using the same tools they use to predict things like movements of the stock market. Both the San Francisco Fed and UHERO use Google mobility information to see what’s going on.

An important aspect of the behavioral response to the virus, Lansing said, is that it’s often voluntary on the part of individuals. For example, he said, in the Bay Area in March, economists saw people voluntarily staying at home as the pandemic surfaced, even before government officials imposed restrictions.

Months later, mobility data show that people aren’t as willing to isolate, he said.

“It’s not clear the behavioral response is going to be as strong now as it was then,” he said of the voluntary stay-at-home.

Google cell phone data shows people began staying at home before government officials imposed orders in late March, but now people are moving about almost as much as they were in early March, even as the virus is spreading out of control on Oahu. UHERO

That’s similar to the pattern in Hawaii. Data suggests people were concerned enough about the spread of COVID-19 in the latter part of March that they were already starting to shelter at home before government officials made them do so, Bonham said.

And when the government did step in, activity dropped even more sharply. By the height of the government shutdown, around Easter weekend, there was 63% less activity.

Now, the situation seems to be changing. Despite the virus surging, with new cases in the triple digits daily on Oahu, people are going out and about almost as much as they were in early March when there were relatively few cases in Hawaii.

Bonham noted that people in Hawaii aren’t moving around as much as they were at a peak in July. But he said, “People are out and about much more than they were in April.”

The reason isn’t clear.

Bonham said it might be because people know what to do to mitigate risk: to wear masks, stay 6 feet apart from others and stay inside social bubbles.

Lansing said it might be more a matter of people being tired of virus containment efforts and messaging. But he conceded economists generally don’t know.

“They’re right, we don’t know,” Bonham said. “Surely some of it is fatigue.”

A sign explaining COVID closures at a Ka'a'awa Beach Park blocks cars from access on Thursday, August 13, 2020. (Ronen Zilberman photo Civil Beat)
Beaches and parking lots will remain closed as Honolulu officials try to limit large gatherings to contain the spreading coronavirus. Ronen Zilberman/Civil Beat/2020

Whatever the reason, Lansing said, it seems governments may have to step in and impose restrictions, as Hawaii is doing again. He pointed to a recent op-ed piece by Michael Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota, and Neel Kashkari, president of the Federal Reserve Bank of Minneapolis.

They call for something familiar to people in Hawaii: a strict shut down to get the virus under control, followed by extensive testing and contact tracing to keep the virus under control as things reopen.

Of course, that didn’t work in Hawaii, in part, it seems, because the state Department of Health didn’t set up the contact tracing capacity needed to keep the virus under control when things reopened in June.

Now, Caldwell appears to be hoping the virus can be tamed with a more modest approach than the one that previously tamped out the virus in April and May. He calls it a scalpel rather than a hammer approach. Instead of a broad closing, Caldwell is trying to eliminate large gatherings — bigger than five people — including parties at homes or office pau hanas. He’s also keeping the beaches, parks and hiking trails closed, while letting places like gyms, salons, restaurants and malls stay open.

Bonham said it will be important that people comply and not attend big parties and other gatherings, which can become superspreader events where a relatively small group of people infect a large number of people, who go on to pass the disease to others before public health officials can begin to get a handle on the cases. Some estimate these events cause as much as 80% of cases, and no amount of contact tracing capacity can stop that.

“That’s not solved by contract tracing,” Bonham said. “And it’s not solved by better communication unless you can get through to people.”

To do that Bonham has come up with bumper sticker slogans like: Go to the beach party, but you might not have a job when you get home.

Or as Osterholm and Kashkari wrote, more gloomily: “The path of the virus will determine the path of the economy. There won’t be a robust economic recovery until we get control of the virus.”

Hawaii’s Changing Economy”  series is supported by a grant from the Hawaii Community Foundation as part of its CHANGE Framework project.

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