Vast data exists on conditions of Hawaii’s economy, but the state is about to lose a powerful human base of economic knowledge benefiting local consumers, businesses and government.
Eugene Tian, one of only a few people in the state with a comprehensive expert- level understanding of Hawaii’s $116 billion economy, is retiring as the state’s chief economist effective Sunday.
Tian, 68, is one of only three people to hold the position in state history, and has held the job for 15 years as part of a 33-year career at the state Department of Business, Economic Development and Tourism.
DBEDT Director James Kunane Tokioka called Tian the guiding force behind economic strategies, and someone who has delivered reliable insights that shaped policies and helped navigate the state through challenges and opportunities.
“His wisdom and expertise have been invaluable and his countless contributions to the state of Hawaii are immeasurable,” Tokioka said in a statement.
Tian, who typically answers his phone with the one-word prompt “Research,” has been focused on Hawaii economic research for so long that he can recite an array of statistics about the state from memory, such as how many people have jobs, the total value of building permits, the housing supply and visitor arrival counts.
He can tell you that 76% of Hawaii’s gross domestic product — the $116 billion value of the local economy — is from household spending and that 70% of this amount is spent on services versus merchandise.
Economics, however, wasn’t an area of interest when Tian moved to Hawaii from China 40 years ago in pursuit of a graduate degree from the University of Hawaii.
It was lettuce.
Before Tian moved to Honolulu in 1985, he had a bachelor’s degree in agricultural engineering and was interested in the efficiencies of Hawaii farmers producing lettuce year-round by rotational use of farm plots instead of the one annual crop grown where he grew up in northeastern China historically known as Manchuria.
Tian, then 28, enrolled at UH to earn a master’s degree in agricultural engineering, and as part of his studies took an agricultural economics course that changed his career trajectory.
“That course made me change my mind,” he said from his fourth-floor corner office in the No. 1 Capitol District Building where DBEDT is headquartered next to the state Capitol. “I thought that economics was so interesting.”
Tian’s new outlook at that time was ingrained in how economics can benefit people in their personal lives and society as a whole based on understanding resource allocations that maximize well-being.
After obtaining his master’s degree, he earned a doctorate in agricultural resource economics from UH in 1992 and became a staff economist at DBEDT that year after an internship as a research assistant.
At DBEDT, Tian began working on gross domestic product estimates for Hawaii and built the first update in a long time to mathematical formulas used to estimate the value of the economy based on what is consumed, what is produced, what is exported and other “inputs and outputs” by consumers, businesses and government.
Tian’s input-output model gave state leaders, businesses and others a much- improved understanding of the local economy.
Paul Brewbaker, a local economist who joined the economics department at Bank of Hawaii the same year Tian moved to Hawaii, called Tian “the input- output master.”
Brewbaker, now in private consulting, said it was unusual at the time for a state to have its own sophisticated calculator to estimate gross domestic product, but valuable given Hawaii’s long history of high dependence on international trade.
“It’s one thing for a country to have a model,” Brewbaker said. “It’s an entirely different thing for a state to have one.”
Among other things, updated versions of Tian’s input-output model have resulted in a more rigorous underpinning for estimating how much tourism contributes to Hawaii’s economy. Lately, it has been about 17%.
Brewbaker said Tian contributed to an extraordinary wealth of economic data at DBEDT along with other fine economists who included Tian’s predecessor, Pearl Imada-Iboshi, and the state’s first chief economist, Richard Joun, who served from from 1963 to 1995.
“Kudos to Tian,” Brewbaker said. “He’s been a great colleague, and made a real contribution to the community, the business community in particular, and our ongoing understanding of Hawaii’s economy.”
Tian’s 33 years at DBEDT’s Research and Economic Analysis Division included becoming its first tourism research manager and branch chief in 1998 when such work was shifted away from the Hawaii Visitors and Convention Bureau.
In 2004, Tian became chief of the division’s statistics and data support branch, which produces the annual state Data Book, a now all-digital compilation of information about Hawaii.
A few things about the state in the book’s most recent addition from 2023 include its richest resident (Pierre Omidyar, with a net worth of $6.4 billion), how many felons were released from prison (69), average annual car insurance premium ($1,408), and most common newborn names in 2022 (Noah for boys, and Olivia for girls).
Tian in 2010 became chief economist as head of DBEDT’s Research and Economic Analysis Division and its economic research branch.
Of the division’s four branches, Tian has led all but a labor research branch. The division has a $6.6 million annual budget and 29.5 full-time employees plus two currently vacant positions.
About 70% of the division’s budget goes to tourism and labor research, according to Tian.
One regular research product is a quarterly forecast for the state’s economy. The next one is due out Wednesday. It may be more optimistic than one produced earlier this month by the University of Hawaii Economic Research Organization predicting a mild recession for the state starting before year’s end and stretching into 2026.
During Tian’s tenure at DBEDT, Hawaii has experienced several severe economic shocks, including one exacerbated by Hurricane Iniki in 1992 when he first joined the agency, followed by a 2001 downturn influenced by the demise of the dot-come bubble and 9/11, the 2009 Great Recession brought on by a global financial crisis, and the 2020 recession stemming from the coronavirus pandemic.
Tian said reasons that led him to retire largely were qualifying for maximum Social Security benefits and being able to spend more time with his two grandchildren with a third on the way, in addition to having more time with his wife and his son’s family without being so focused on the local economy and work.
Part of Tian’s retirement plan is to take cruises to foreign countries, particularly in Europe and Asia, where he said he intends to leisurely assess their economies by observing products, prices and people at public markets.
A successor to Tian at DBEDT has not yet been determined, but on a temporary basis will include a rotation among the leaders of the agency’s other three branches.
