The Pacific archipelago, already on edge over the threat posed by North Korea, was terrorised by the erroneous alert, which was sent out by phone to residents and tourists and remained uncorrected for nearly 40 minutes.
Another employee of the state agency, which is responsible for notifying the public of threats to their safety, has been suspended, Major General Joe Logan, the state adjutant general, told reporters in Hawaii.
A state investigative report released today said that the fired employee had been a "source of concern" for 10 years because of his "poor performance."
"He is unable to comprehend the situation at hand and has confused real life events and drills on at least two separate occasions," the report said.
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In a separate report, the Federal Communications Commission (FCC) said the officer claimed he believed the threat was real and had not heard a phrase stating that it was an exercise.
Mobile phones across the Pacific islands received the emergency alert around 8:07 am and it was also transmitted by television and radio stations.
"In the minutes that followed, panic-stricken citizens called their families to say what they believed were their last words, and some even resorted to jumping into manholes to find shelter," FCC chairman Ajit Pai said in a statement accompanying the report.
The erroneous message came amid tensions with North Korea, which has tested rockets powerful enough to reach the United States, though it is unclear whether they are yet able to deliver nuclear payloads.
The FCC and state investigators blamed the mistake on a combination of human error, insufficient management controls and poor computer software.
It began, the FCC report said, with a decision by the overnight-shift supervisor to conduct an unannounced drill when the day shift arrived at 8:00 am.
The overnight-shift supervisor informed the day-shift supervisor of the plan but the day-shift supervisor understood the drill was for the overnight workers ending their shift not for his arriving staff.