State of the Economy

3rd Quarter 2022 Report

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Hawaii’s major economic indicators were mixed in the second quarter of 2022. Visitor arrivals, wage and salary jobs, State general fund tax revenues and Government contracts awarded all increased in the quarter compared to the second quarter of 2021. But private building authorizations decreased in the quarter.

In the second quarter of 2022, the total number of visitors arriving by air to Hawaii increased 519,651 or 27.3 percent and daily visitor census increased 41,250 or 20.7 percent.

In the second quarter of 2022, the construction sector lost 1,300 jobs or 3.5 percent compared with the same quarter of 2021. State government CIP expenditures declined $91.8 million or 20.8 percent in the second quarter of 2022 compared with the same quarter of 2021. In the second quarter of 2022, the permit value for private construction decreased $711.0 million or 52.8 percent compared with the same quarter of 2021. According to the most recent excise tax base data available, construction put-in-place increased $219.8 million or 9.4 percent in the first quarter of 2022, compared with the same quarter of the previous year.

In the second quarter of 2022, State general fund tax revenues increased $592.4 million or 24.6 percent over the same period of 2021. The state general excise tax revenue increased $182.7 million or 20.4 percent, the transient accommodations tax (TAT) increased $94.3 million or 80.2 percent, the net individual income tax revenues increased $248.6 million or 20.9 percent and the net corporate income tax revenues decreased $0.9 million. In the first half of 2022, State general fund tax revenues increased $1,217.6 million or 30.4 percent compared to the same period of the previous year.

Labor market conditions were mainly positive. In the second quarter of 2022, Hawaii’s non-agricultural wage and salary jobs averaged 606,800 jobs, an increase of 23,300 jobs or 4.0 percent from the same quarter of 2021.

The job increase in the second quarter of 2022 was mainly due to job increases in the private sector. In this quarter, the private sector added about 23,200 non-agricultural jobs compared to the second quarter of 2021. Jobs increased the most in Accommodation, which added 9,600 jobs or 34.7 percent; followed by Food Services and Drinking Places, which added 7,100 jobs or 12.6 percent, Other Services, which added 1,900 jobs or 7.9 percent, Transportation, Warehousing & Utilities, which added 1,800 jobs or 6.1 percent, and Arts, Entertainment & Recreation, which added 1,200 jobs or 13.0 percent in the quarter. The Government sector lost 100 jobs or 0.1 percent in the second quarter of 2022 compared to the same quarter of 2021. The Federal Government added 100 jobs or 0.3 percent, the State Government remained the same jobs, and the Local Government lost 200 jobs or 1.1 percent, compared to the second quarter of 2021.

In the first quarter of 2022, total annualized nominal GDP increased $11,403 million or 13.5 percent, from the first quarter of 2021. In 2021, total annualized nominal GDP increased $7,175 million or 8.7 percent from the previous year. In the first quarter of 2022, total annualized real GDP (in chained 2012 dollars) increased $4,648 million or 6.6 percent from the first quarter of 2021. In 2021, total annualized real GDP increased $3,254 million or 4.6 percent from the previous year.

In the first quarter of 2022, total non-farm private sector annualized earnings increased $6,256.7 million or 16.7 percent from the first quarter of 2021. In dollar terms, the largest increase occurred in accommodation and food services; followed by health care and social assistance, transportation and warehousing, retail trade, and construction. During the first quarter of 2022, total government earnings decreased $491.6 million or 3.0 percent from the same quarter of 2021. Earnings from the federal government increased $199.6 million or 2.3 percent. Earnings from the state and local governments decreased $691.2 million or 8.9 percent in the quarter.

In the first half of 2022, Honolulu’s Consumer Price Index for Urban Consumers (CPI-U) increased 6.7 percent from the same period in 2021 (Table B-14). This is 1.6 percentage point below the 8.3 percent increase for the U.S. average CPI-U but is higher than the first half of 2021 Honolulu CPI-U increase of 2.6 percent from the same period of the previous year. In the first half of 2022, the Honolulu CPI-U increased the most in Transportation (16.9 percent), followed by Food and Beverages (8.6 percent), Recreation (5.4 percent), Other Goods and Services (4.7 percent), Housing (4.5 percent), Education and Communication (1.3 percent), and Apparel (1.0 percent) compared to the first half of 2021.