State Economic Growth ContinuesPosted on Feb 27, 2015 in News
For Immediate Release: February 27, 2015
DBEDT News Release 15-01
HONOLULU—In its first quarter 2015 Statistical and Economic Report, the Department of Business, Economic Development & Tourism (DBEDT) projects that Hawaii’s economy will continue its stable growth in 2015 and beyond.
“We are happy to see that our labor market has fully recovered from the 2009 recession, and in 2014 we had an historical high level of civilian labor force, civilian employment and payroll job count. Our unemployment rate was the 6th lowest in the nation,” said DBEDT Director Luis P. Salaveria. “2014 was a record year for visitor arrivals as well. With the strong growth in the U.S. economy, we expect our visitor industry to continue to grow in 2015, especially in the U.S. markets.”
In 2015, the U.S. economy is expected to grow by 3.2 percent, a rate which has not been seen since 2005. This growth will likely encourage more Hawaii visitation by U.S. visitors. Total air seats, an indicator for the supply side of the tourism industry, is expected to increase by 5.8 percent in 2015 with a 7.4 percent gain from U.S. mainland flights and 2.5 percent increase from international flights. Though total visitor arrivals decreased in January 2015, DBEDT expects total visitor arrivals to catch-up in the coming months and end the year with a 2.1 percent increase in 2015.
According to data released by the U.S. Bureau of Labor Statistics, Honolulu consumer inflation increased by 1.4 percent in 2014 as compared to 2013. This increase is similar to the 1.5 percent inflation rate projected by DBEDT in the third quarter of 2014.
Caused by the recent drop in crude oil prices, the slow growth in consumer inflation in 2014 was due primarily to the decrease in gasoline prices, and in the continued decrease in the price level of apparel, household furnishings and supplies.
DBEDT expects Honolulu consumer inflation to grow by 1.8 percent in 2015. An inflation rate which is lower than the average rate of 2.3 percent over the past 20 years (between 1994 and 2014).
As a result of lower price levels, consumers are expected to have more purchasing power in 2015 which can be translated into an increase in real income if income as measured by nominal dollars remains unchanged.
In this current economic forecast, growth in real personal income and real gross domestic product (GDP) increased as compared with the previous forecast. Real personal income is expected to grow by 2.8 percent and real GDP is expected to grow by 3.1 percent in 2015. This economic growth rate for Hawaii is similar to the economic growth rate projected for the nation in 2015.
After setting a record in 2014, total non-agriculture wage and salary job count is expected to grow by 1.2 percent in 2015 to a level of 634,500 jobs. This growth rate is higher than the 20 year annual average growth rate of 0.8 percent. The unemployment rate is projected to be at 3.9 percent in 2015 while the national unemployment rate is projected to be at 5.4 percent for 2015 as projected by the top 53 economic forecast organizations in the United States.
Value of construction completed as measured by the contracting tax base has been declining since the third quarter of 2013. However, the value of private building permits granted in 2014 increased by 21.9 percent which may indicate a busier year for construction workers in 2015. Among the private construction projects permitted, the value of commercial and industrial projects increased 68.1 percent. The value of additions and alterations projects increased 30.8 percent while the value of residential projects decreased by 3.8 percent.
In 2014, state government spending on capital improvement projects (CIP) totaled $1.3 billion representing an 11.1 percent increase from 2013. CIP spending by state government is expected to be at a similar level in 2015.
DBEDT expects healthy economic growth to continue into the future, as seen by real GDP growth projected to be at 3.0 percent in 2016 and 2.9 percent in 2017.
The DBEDT Quarterly Statistical and Economic Report contains more than 100 tables of the most recent quarterly data on Hawaii’s economy as well as narrative explanations of the trends in these data. The full report is available here.
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ACTUAL AND FORECAST OF KEY ECONOMIC INDICATORS FOR HAWAII: 2013 TO 2018
|Total population (thousands)||1,409||1,420||1,434||1,448||1,463||1,477|
|Visitor arrivals (thousands) ¹||8,174||8,283||8,453||8,598||8,741||8,885|
|Visitor days (thousands) ¹||74,942||75,498||77,206||78,517||79,806||81,114|
|Visitor expenditures (million dollars) ¹||14,521||14,857||15,358||16,014||16,642||17,293|
|Honolulu CPI-U (1982-84=100)||253.9||257.6||262.2||268.0||274.7||282.1|
|Personal income (million dollars) ²||63,468||66,007||68,977||72,288||75,903||79,698|
|Real personal income (millions of 2008$) ³||50,794||52,165||53,626||55,127||56,616||57,918|
|Non-agricultural wage & salary jobs (thousands)||617.6||625.2||634.5||643.4||651.8||659.6|
|Civilian unemployment rate||4.8||4.3||3.9||3.6||3.4||3.3|
|Gross domestic product (million dollars) 4||75,235||78,518||82,328||86,197||90,028||94,031|
|Real gross domestic product (millions of 2009$) 4||70,110||72,003||74,235||76,462||78,680||80,647|
|Gross domestic product deflator (2009=100) 4||107.3||109.0||110.9||112.7||114.4||116.6|
|Annual Percentage Change|
|Visitor arrivals ¹||1.8||1.3||2.1||1.7||1.7||1.7|
|Visitor days ¹||0.6||0.7||2.3||1.7||1.6||1.6|
|Visitor expenditures ¹||1.1||2.3||3.4||4.3||3.9||3.9|
|Personal income ²||2.4||4.0||4.5||4.8||5.0||5.0|
|Real personal income ³||1.1||2.7||2.8||2.8||2.7||2.3|
|Non-agricultural wage & salary jobs||1.9||1.2||1.5||1.4||1.3||1.2|
|Civilian unemployment rate 5||-0.9||-0.5||-0.4||-0.3||-0.2||-0.1|
|Gross domestic product 4||3.8||4.4||4.9||4.7||4.4||4.4|
|Real gross domestic product 4||1.9||2.7||3.1||3.0||2.9||2.5|
|Gross domestic product deflator (2009=100) 4||1.9||1.6||1.7||1.7||1.5||1.9|
1/ Visitors who came to Hawaii by air or by cruise ship, includes supplementary expenditures estimated by HTA for 2013 and
2/ The 2014 values are estimated based on actual values in the first three quarters of 2014.
3/ Using personal income deflator developed by the U.S. Bureau of Economic Analysis.
4/ 2014 and later years are estimated by DBEDT, data for earlier years from U.S. Bureau of Economic Analysis.
5/ Absolute change from previous year.
For more information, contact:
DBEDT Research and Economic Analysis Division
Phone: (808) 586-2422