E. Construction

3rd Quarter 2019 Report

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The indicators of Hawaii’s construction industry were mostly negative in the second quarter of 2019. Private building authorizations, government contracts awarded, and State government CIP expenditures declined, while construction jobs increased.

Construction has been one of the steady contributors to job growth in Hawaii over the past few years. In the second quarter of 2019, the number of jobs in the construction sector increased 2.5 percent or 900 jobs compared with the same quarter of 2018. In the first half of 2019, the construction sector added 700 jobs or 2.0 percent (Table A-7) from the same period of the previous year. Before the recession, specifically the period 2002 through 2007, construction job growth averaged 8.0 percent per year. In the fourth quarter of 2007, the average number of construction jobs reached a peak of 40,000 jobs. The strength of the construction job market in the past few years was a sharp contrast to the recession period. From the second quarter of 2008 until the second quarter of 2011 quarter-over-quarter construction job growth was negative in all quarters.

In the second quarter of 2019, private building authorizations in the state decreased $299.6 million or 27.0 percent, compared with the second quarter of 2018 (Table E-8). In the first half of 2019, private building authorizations in the state decreased $238.4 million or 13.2 percent compared with the same period of the previous year.

In the second quarter of 2019, private building authorizations in Honolulu decreased $230.3 million or 30.5 percent, compared with the second quarter of 2018 (Table E-8). In the first half of 2019, private building authorizations in Honolulu decreased $100.1 million or 8.7 percent, compared with the same period of the previous year.

In the second quarter of 2019, private building authorizations in Hawaii County increased $6.3 million or 5.5 percent, compared with the second quarter of 2018 (Table E-8). In the first half of 2019, private building authorizations in Hawaii County decreased $9.9 million or 3.9 percent, compared with the same period of the previous year.

In the second quarter of 2019, private building authorizations in Maui County decreased $58.5 million or 30.6 percent, compared with the second quarter of 2018 (Table E-8). In the first half of 2019, private building authorizations in Maui County decreased $104.1 million or 32.8 percent compared with the same period of the previous year.

In the second quarter of 2019, private building authorizations (residential only) in Kauai County decreased $17.2 million or 36.2 percent, compared with the second quarter of 2018 (Table E-8). In the first half of 2019, private building authorizations in Kauai County decreased $24.3 million or 28.6 percent compared with the same period of the previous year.

Government contracts awarded decreased $469.3 million or 78.4 percent in the second quarter of 2019 compared with the same quarter of 2018. In the first half of 2019, government contracts awarded declined $845.8 million or 74.8 percent compared with the previous year (Table E-1). State government CIP expenditures declined $165.9 million or 28.1 percent in the second quarter of 2019 compared with the same quarter of 2018 (Table E-2). In the first half of 2019, CIP expenditures declined $133.1 million or 15.6 percent compared with the same period of the previous year.

The Honolulu Construction Cost Index increased 2.7 percent in the second quarter of 2019 compared to the same quarter of 2018 for Single Family Residence (Table E-6) and increased 2.3 percent for High-Rise Building (Table E-7). In the first half of 2019, the index for Single Family Residence increased 2.3 percent and 2.0 percent for High-Rise Building as compared to the same period in the previous year.

In the second quarter of 2019, Honolulu’s median price for single family resales was $775,000, a decrease of $6,194 or 0.8 percent compared to the same quarter of 2018 (Table E-11). The median price for condominium units was $422,500, up $1,500 or 0.4 percent over the same quarter of 2018 (Table E-12). In the second quarter of 2019, the number of single-family unit resales declined 2.1 percent, and the number of condominium unit resales declined 7.6 percent, compared with the second quarter of 2018 (Tables E-13 and E-14). In the first half of 2019, the number of single-family unit resales declined 3.7 percent, and condominium unit resales declined 8.8 percent compared with the same period of the previous year.

In the first half of 2019, Maui County’s single-family unit resales median price was $740,000 and the condominium unit resales median price was $525,000 (Tables E-17 and E-18).