Research & Economic Analysis

2nd Quarter 2025 Report

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Hawai’i’s major economic indicators were mixed in the first quarter of 2025. The civilian labor force, wage and salary jobs, visitor arrivals, and private building permit authorizations increased. However, State general fund tax revenues and government contracts awarded decreased.

In the first quarter of 2025, the total number of visitors arriving by air to Hawai’i increased 38,676 or 1.6 percent and the daily visitor census increased 4,809 or 2.0 percent.

In the first quarter of 2025, the construction sector added 700 jobs or 1.8 percent compared with the same quarter of 2024, while the permit value for private construction increased $401.4 million or 39.9 percent. Government contracts awarded decreased $22.1 million or 5.9 percent, compared with the same quarter of 2024. According to the most recent excise tax base data available, the contracting tax base increased $381.4 million or 12.4 percent in the fourth quarter of 2024, compared with the same quarter of the previous year. For 2024 the contracting tax base increased $2,112.0 million or 17.8 percent compared with the previous year.

In the first quarter of 2025, State general fund tax revenues decreased $105.5 million or 4.7 percent over the same period of 2024. The state general excise tax revenue increased $51.6 million or 4.4 percent, the transient accommodations tax (TAT) increased $1.9 million or 0.8 percent, the net corporate income tax revenues decreased $105.4 million, and the net individual income tax revenues decreased $70.3 million or 10.8 percent. In 2024, State general fund tax revenues increased $620.9 million or 6.5 percent compared to the previous year.

Labor market conditions improved. In the first quarter of 2025, the civilian labor force averaged 690,050 people, an increase of 11,400 or 1.7 percent over the same period of 2024. The unemployment rate (not seasonally adjusted) was 2.6 percent, 0.2 of a percentage point lower than the first quarter of 2024. Hawai‘i’s non-agricultural wage and salary jobs averaged 647,800 jobs, an increase of 11,600 jobs or 1.8 percent from the same quarter of 2024.

The job increase in the first quarter of 2025 was due to job increases in both the private and government sectors. In this quarter, the private sector added about 8,700 non-agricultural jobs compared to the first quarter of 2024. The majority of private sector industries added jobs in the quarter. The number of jobs increased the most in Health Care & Social Assistance, which added 2,100 jobs or 2.8 percent, followed by Food Services & Drinking Places, which added 1,500 jobs or 2.3 percent, Other Services, which gained 1,200 jobs or 4.5 percent, and Arts, Entertainment, and Recreation, which added 1,000 jobs or 7.6 percent. The Government sector added 2,900 jobs or 2.3 percent in the first quarter of 2025 compared to the same quarter of 2024. The Federal Government lost 400 jobs or 1.1 percent, the State Government added 2,800 jobs or 3.9 percent, and the Local Government added 500 jobs or 2.7 percent, compared to the first quarter of 2024.

In the fourth quarter of 2024, total annualized nominal GDP increased $5,355 million or 4.8 percent, from the same quarter of 2023. In 2024, total annualized nominal GDP increased $5,362 million or 4.9 percent from the previous year. In the fourth quarter of 2024, total annualized real GDP (in chained 2017 dollars) increased $1,648 million or 1.8 percent from the same quarter of 2023. In 2024, total annualized real GDP increased $1,666 million or 1.9 percent from the previous year.

In the fourth quarter of 2024, total non-farm private sector annualized earnings increased $2,098.1 million or 4.3 percent from the same quarter of 2023. In dollar terms, the largest increase occurred in Construction; followed by Accommodation and Food Services, and Health Care and Social Assistance. During the fourth quarter of 2024, total government earnings increased $1,912.9 million or 10.2 percent from the same quarter of 2023. Earnings from the federal government increased $592.5 million. Earnings from the state and local governments increased $1,320.4 million in the quarter.

In the second half of 2024, Honolulu’s Consumer Price Index for Urban Consumers (CPI-U) increased 4.0 percent from the same period in 2023. This is 1.3 percentage points above the 2.7 percent increase for the U.S. average CPI-U. It is also higher than the 2.9 percent increase in the Honolulu CPI-U for the second half of 2023 compared to the same period of the previous year. In the second half of 2024, the Honolulu CPI-U increased the most in Housing (6.2 percent), followed by Apparel (4.5 percent), Food & Beverages (3.4 percent), Recreation (3.3 percent), Medical Care (1.3 percent), and Transportation (1.2 percent) compared to the second half of 2023. Other Goods & Services remained the same and Education & Communication decreased (1.4 percent) in the second half of 2024 compared to the second half of 2023.