Economic growth stable; construction leading job growth in the state

POIPU — General Contractor Mark Mohler said he’s seen a steady amount of work since he started work in the construction business in the late 70s.

In August, he started a job in Koloa consisting of two houses: that meant hiring more workers.

“We actually live in Kapaa, but for the past three years, most of the jobs have been (on the South Shore),” he said. “I have two more guys for these projects. It’s good.”

Economic growth in Hawaii remains stable, according to the Department of Business, Economic Development and Tourism’s fourth quarter 2016 Statistical and Economic Report.

The department revised its projection on Hawaii’s economic growth — measured by the growth of real gross domestic product (GDP) — to 2 percent for the year. The mark is slightly higher than projection made in the previous quarter.

“We are encouraged to see the continued growth in our payroll jobs,” said DBEDT Director Luis P. Salaveria. “During the first three quarters of this year, 14,000 new jobs were added and that’s the highest job gain since the great recession in 2008. Forty percent of the job gains came from the construction industry, which is on track to set a new record year in 2016.”

However, Hawaii economic growth rates are expected to diminish to 1.6 percent by 2019 due to inflation.

Leading the job growth this year are construction jobs, which grew 16.5 percent during the first nine months of this year.

“The last house we worked on was a small guest house and so it was just my son and me,” Mohler said. “The house before that, which was in Poipu Beach Estates, that was my son and me an another guy. Then we came here and met John Lorenzo, so he wants to pick a little bit of money.”

Lorenzo, a mason for 45 years who is semi-retired, said he’s seen a steady flow of construction jobs and more after hurricanes.

Like Mohler, Lorenzo said he’s seen more jobs in the Koloa and Poipu area.

“If they need me in Haena, I’ll go, but my house is right here in Koloa (so most of my work is here),” he said.

Educational services, entertainment, and food services each grew by 4.3 percent during the same time period. Job loss mainly happened in wholesale trade and state government.

“Tourism has been performing better than expected and we have revised our visitor arrival projection to 2.3 percent and visitor spending projection to 3.9 percent, both of which are higher than previously projected,” said Chief State Economist Eugene Tian. “Due to the appreciation of their currency, both Japanese and Canadian visitor daily spending have increased during the last few months.”

Tian said year-to-date through September, visitor arrivals increased by 2.6 percent and visitor spending increased by 3.7 percent. Visitor arrivals is likely to be another record year in 2016.

DBEDT expects that visitor arrivals will reach 8.9 million in 2016, a 2.3 percent increase from 2015. Visitor spending is projected to increase by 3.9 percent to $15.7 billion. Visitor arrivals growth in the next few years will be diminished to below 2 percent.

Hawaii’s unemployment rate during the first nine months of 2016 averaged at 3.3 percent, 0.5 percentage points lower than the same period in 2015 and ranked Hawaii the fifth lowest in the nation.

Honolulu’s unemployment rate was the lowest among the counties at 3.1 percent, followed by Maui County at 3.4 percent, Kauai at 3.6 percent and Hawaii County at 4.1 percent during the first nine months of 2016.


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