We all like good news. It’s nice to read about the good things people do and nice to recognize folks when they do well. It’s wonderful when we learn that things are going well. Gloomy projections can make us weary and worried. And sometimes, the cost of living in paradise can get us down and make us wonder if it’s all worth it. Positive estimates can make us feel less fearful and more courageous.
So when the Department of Business, Economic Development and Tourism released its first quarter 2018 Statistical and Economic Report and it showed that Hawaii’s overall economic condition in 2018 will be better than previously projected — due to the expected short-term increase in business and household income resulting from the federal tax reform — we wanted to be sure to share it.
Here’s some of what the report said:
In 2017, Hawaii saw several record statistics in our local economy. During the fourth quarter, unemployment rates were the historical lowest for all the counties in the state, making Hawaii the best labor market in the United States. Statewide labor force, employment, and payroll job count registered new historical high levels in 2017. Visitor arrivals reached 9.4 million, a new record year. Real estate market performed well with median home sale prices up for all the counties, sales volume all up except Kauai County, with a 2.8 percent decrease, for 2017.
Entering 2018, there are positive signs for our economy, including the financial sector distributing bonuses and a raised minimum wage rate. The state minimum wage increased to $10.10 per hour effective Jan. 1. The airlines will provide more than 13 million air seats to the state in 2018, a 9 percent increase from the previous year.
“We are happy to see the steady growth in our economy in the areas of tourism, professional services and healthcare industries,” said DBEDT Director Luis P. Salaveria.
In 2017, the state gained 7,200 additional non-agriculture payroll jobs as compared with a year earlier. The increase in jobs mostly occurred in tourism-related industries. Retail trade and food services each added 2,100 jobs, accommodation added 1,100 hotel jobs, transportation, warehousing, and utilities added 800 jobs. Beyond tourism, professional and business services experienced the largest job gains at 1,800 additional jobs, healthcare and social assistance increased 700 jobs. Educational services gained 400 jobs. However, a few industries continued losing jobs. State government lost 1,000 payroll jobs, wholesale trade lost 700 jobs, financial activities lost 500 jobs, manufacturing and construction each lost 200 jobs in 2017.
The value of private building permits decreased 3.5 percent in 2017. The value of residential permits increased 3.9 percent, commercial and industrial permit value increased 87.6 percent, and value of additions and alterations decreased by 22.4 percent.
The most recent forecast (January 2018) for the U.S. and the world indicates that most of the economies of the world, especially those our visitors are coming from, will experience continued economic growth in 2018 and 2019. The U.S. economy is expected to grow by 2.7 percent in 2018 and 2.4 percent in 2019.
DBEDT revised the visitor industry forecast upward again with visitor arrivals now growing at 2.7 percent for 2018, 1.6 percent for 2019 and 1.4 percent for 2020 and 2021. Growth of visitor expenditures will be at 4.5 percent for 2018, 3.7 percent for 2019, and 3.5 percent for 2020 and 2021.
“The scheduled air seats on flights to Hawaii in 2018 are expected to increase by 9 percent, with capacity directly to the neighbor islands expected to increase by more than 22 percent this year,” said Chief State Economist Dr. Eugene Tian. “The passenger count in January 2018 has shown some effects of the changes — passenger count from the U.S. mainland increased 19.8 percent for the Big Island, 19.1 percent for Kauai, 4 percent for Maui, and 6 percent..”
DBEDT revised its projection for Hawaii’s economic growth, as measured by the real gross domestic product (GDP), upward from the fourth quarter 2017 projection to 1.7 percent for 2018, 1.6 percent for 2019, and 1.4 percent for 2020 and 2021.
One thing seems clear. We should brace for more growth. Yes, there are pros and cons to that growth here and not everyone is wild about more visitors and more people moving here to live, but can you blame them? When the day arrives that no one wants to visit or move here, that really will be bad news.