BY EUGENE TIAN – HONOLULU — In its fourth quarter economic report, the Department of Business, Economic Development & Tourism (DBEDT) is more optimistic about Hawai‘i’s economic forecast for 2010 and 2011. DBEDT expects that increasing tourism arrivals and expenditures in Hawai‘i will help speed the recovery of Hawai‘i’s economy.
“We are happy to see that most of the economic indicators in our state showed positive growth during the third quarter of this year,” said DBEDT Director Theodore E. Liu. “The growth of our two largest industries, tourism and Federal government, is very healthy. We are expecting more than 7 million visitors this year, and with the increase in Federal spending, Hawai‘i’s economy continues to perform better than the nation in many major areas.”
Recent forecasts for the U.S. economy are showing slightly lower growth in 2010 than previously projected. The consensus forecast for the U.S. now expects a 2.7 percent increase in Real Gross Domestic Product (GDP) for 2010. That is down from a 2.9 percent projection last quarter. Similarly, forecasts of key international economies are also slightly worse. However, Hawai‘i’s tourism industry, real estate, and labor markets continue performing better than the nation as a whole.
DBEDT now expects total visitor arrivals to increase 7.7 percent in 2010, up 3.1 percentage points from the previous forecast. Visitor expenditures are now expected to increase 14.8 percent in 2010, is 6.6 percentage points higher than DBEDT’s previous forecast. Total visitor days are now projected to increase 8.2 percent in 2010, compared to the 4.1 percent increase projected in the previous forecast.
The updated forecast for 2010 real gross state domestic product is for a 1.4 percent growth, higher than the 1.2 percent forecast last quarter. The current forecast of current dollar personal income growth in 2010 is 2.7 percent, a 0.2 percentage point increase from the previous forecast. Real personal income in 2010 is now expected to increase 0.5 percent, slightly higher than the 0.3 percent growth in the previous forecast.
Total wage and salary jobs in Hawai‘i are now expected to decline 0.4 percent in 2010, better than the 0.6 percent decrease previously projected.
The Honolulu Consumer Price Index (CPI), a proxy for inflation, is expected to rise 2.2 percent in 2010, same as previously projected.
Assuming continued improvement in national and international economic conditions, a gradual pace of recovery will likely continue next year and into 2012 and 2013, barring unforeseen events.
Visitor count is expected to exceed the 2007 peak level of 7.6 million by 2013, but the wage and salary job count will take longer time to recover to its peak year of 2007 with 631,350 jobs.
The DBEDT Quarterly Statistical and Economic Report contains more than 100 tables of the most recent quarterly data on Hawai‘i’s economy as well as narrative explanations of the trends in these data. The full report is available at:
https://www.hawaii.gov/dbedt/info/economic/data_reports/qser
Submitted by the state of Hawaii