Maui’s unemployment rate a year after the wildfire that destroyed Lahaina doesn’t look bad on paper, but the island is still suffering pretty severely with employment.

A state report published Monday showed that the unemployment rate on Maui was 4.0% in September. That compares with 3.2% for all of Hawaii and 3.9% for the nation. A year earlier, Maui’s unemployment rate was 8.9%.

However, much of the reason for Maui’s rather moderate rate in September is likely due to people who had jobs before the Aug. 8, 2023, wildfire who are either no longer looking for work or have left the island, according to Eugene Tian, chief economist at the state Department of Business, Economic Development and Tourism.

“Not that many people are looking for work,” he said. “The labor force decline is not a good thing.”

A University of Hawaii Economic Research Organization report in September said that about 4,200 workers in Maui County, which includes Molokai and Lanai, had left the labor force, representing a 5% loss compared with pre-fire levels.

The UHERO report said Maui County had regained almost 40% of the lost jobs from a low point in September 2023, but that there were still 4,000 fewer jobs than there were just before the disaster.

“Challenging labor market conditions on Maui, coupled with the Valley Isle’s ongoing housing crisis, have driven some residents to leave,” the report said, noting that no good data exists on how many residents have left or whether they plan to return.

UHERO forecasts that Maui has a slow, delayed path to recovery for its labor market, with unemployment improving to 3.5% in 2025, 3.4% in 2026 and 3.2% in 2027 while the state rate improves to between 2.7% and 2.6% in those same years after hovering right around 3% for the past 13 months.

Tian said a 2% rate would reflect a very good economy. So Maui’s 4% rate in September is double that, but still isn’t bad.

Within the next year, Maui is expected to experience labor shortages, according to the recent UHERO report, largely because of demand to rebuild many more homes that were destroyed in the Lahaina fire. Some of the shortage, the report also said, is expected in tourism as that industry continues to recover amid a short supply of housing and high rent.

The UHERO report pro­jects that Maui needs an estimated 2,000 additional construction workers for rebuilding, which began earlier this year for a relatively small number of properties in Lahaina.

The Lahaina fire destroyed roughly 3,500 homes along with hundreds of businesses, and killed 102 people. There also was a fire the same day that destroyed 19 homes in Upcountry Maui.

Earlier this month, a UHERO survey found that many people affected by the fires remain worse off with employment a year after the disaster.

The survey was based on 402 people in 374 households who, as a result of the fires, were displaced from Lahaina or Upcountry, worked in those places or owned a business in those places.

Of this group, 15.8% were retired or not seeking employment a year after the disaster in August, up from 11.6% in July 2023. The survey also said 18.2% of respondents had part-time work but were looking for more hours to work in August, compared with 6.3% before the fires.

The survey said more than 30% of respondents now work fewer hours than before the wildfires. “That means they either switched from full-time to part-time work or no employment, or from part-time to no employment,” the survey report said.