Hawaii has some built in disadvantages in almost any state competition. Its location makes almost everything expensive. Its size limits development. And many of the usual infrastructure measures don’t work – a freight train service is important on a mainland, for example, but doesn’t work on a Pacific island chain.
So, the Aloha State — this year’s Bottom State for Business in CNBC’s rankings — is focusing on things it can control, chief among them access to child care.
“We know that early learning is critical to our children’s health and development,” said Yuuko Arikawa-Cross, Director of the Hawaii Office of Early Learning. “We also know that in Hawaii, about 60% of households have children, all adults work.”
But child care in Hawaii is the most expensive in the nation, costing 18% of the income of a married couple with children, according to Child Care Aware of America. And with 531 licensed child care facilities in a state of 1.4 million people, Hawaii ranks 21st in child care facilities per capita. The National Institute for Early Education Research said that while Hawaii met all of the agency’s quality indicators last year, it ranked near the bottom for accessibility.
That poor showing helped push Hawaii down CNBC’s overall rankings this year by hurting the state in one category that has kept it in the bottom for years: Quality of Life.
Hawaii finishes No. 6 this year in the division it previously occupied. That means a slight reduction in the country’s worst finish in infrastructure and the Cost of Doing Business, and the fourth highest Cost of Living.
Child care is emerging as a major competitive issue
Dianne Gralnick | Stock | Getty Images
CNBC began covering childcare in 2022, after the US Chamber of Commerce identified it as the biggest reason workers quit their jobs — or don’t return to work.
Hawaii took up the issue at the same time, passing legislation in 2020 that required early learning or preschool programs to be made available to half of the state’s otherwise unserved three- and four-year-olds by 2027, and to 100% of them by 2032.
Arikawa-Cross said the state is on track to reach 50% of the planned level next year.
“We just had a really big effort to try to improve this program,” he said.
Whether the state can reach the 50% goal next year — or the mandated 100% goal in less than six years — may depend on a number of issues that are difficult for Hawaii to control.
Already, early childhood education programs are facing significant funding pressure at the state and local levels.
Arikawa-Cross said that while her office does not receive direct funding outside of one position, officials are looking closely at the idea of state budget cuts to the Head Start program.
A key attorney in Hawaii has been sidelined
The other thing has less to do with funding and more to do with momentum.
The state’s biggest champion for early childhood education is Lieutenant Gov. Sylvia Luke, who founded the country’s early literacy campaign – called Ready Keiki – in 2023 (keiki is the Hawaiian word for children). The program has established a network of partners including government agencies, non-profit organizations and charities to help achieve the global goal of child care.
FILE PHOTO: Hawaii State Representative Sylvia Luke, chairwoman of the House Finance Committee, speaks to reporters at a news conference at the Hawaii State Capitol in Honolulu on May 2, 2019.
Audrey McAvoy AP
But Luke announced in April that he would take an indefinite leave of absence after confirming he was the target of a federal campaign finance investigation. Although he did not admit wrongdoing, Luke suspended his re-election campaign. This month, the state’s campaign finance commission disclosed that it filed civil complaints involving Luke and five others in May. Luke’s attorneys asked that the civil case be stayed because of the ongoing criminal investigation.
But the lawsuit succeeds, leaving Hawaii’s child care efforts without a top advocate as the first deadline under the law approaches.
“Having an artist and someone who is there to support your work and know the value of it was very important,” Arikawa-Cross said. “It’s a big space right now, and our office doesn’t want to lose momentum.”
He said the work will continue even if there is a shortage of high-level professionals.
“We need to stick together, and we need to see this through to the end and beyond,” she said. “We have made a lot of progress, let’s stop now. We still have a lot to do.”
