State Economists Predict Growth in 2013-2014
State officials are predicting positive economic growth through the remainder of the year and into 2014.
In its second quarter 2013 economic report released today, the Department of Business, Economic Development & Tourism predicts continued positive economic growth in 2013, outpacing the national growth rate.
DBEDT also expects to see continued positive growth in 2014.
“We continue to see strength in the overall economy — near previous estimates,” said DBEDT Director Richard C. Lim.
“From our perspective, we believe Hawaii is poised for steady positive economic growth.”
However, the current DBEDT forecast is slightly less optimistic than its February 2013 forecast for some of local economic indicators, such as gross domestic product growth, job growth and visitor-related indicators.
In addition, the projected personal income growth and inflation rate are unchanged from the previous forecast.
Economists note that Hawaii’s overall growth rate is higher than what is being experienced nationally.
The current forecast calls for a 2.4% increase for Hawaii’s 2013 real gross domestic product with a growth rate of 2.3% forecast for the 2014 real GDP.
Both are within 0.2 of a percentage point from the previous forecast.
Hawaii’s 2013 and 2014 GDP growth rates both exceed national averages.
In April, the consensus forecast by the top 50 economic forecasting agencies projected a 2.1% economic growth rate, up from the 1.9% growth rate projected in February 2013.
According to the current economic forecast, Hawaii’s civilian unemployment rate is projected to drop from 5.8% in 2012 to 4.8% in 2013.
Locally, Hawaii County’s unemployment rate in the first quarter of 2013 was 7.3%, down from 9%.
Non-agricultural wage and salary jobs, which increased 1.9% statewide in 2012, are expected to increase another 2% this year.
The 2014 forecast for non-agricultural wage and salary jobs across the state calls for an increase of 1.8%, the same as the previous forecast.
In the first quarter of 2013, Hawaii County gained 1,850 non-agricultural wage and salary jobs, up 3% from the first quarter of 2012.
Natural resources, mining and construction added the most jobs in the quarter (600 jobs), followed by food services and drinking places (450 jobs), other services (450 jobs), and health care and social assistance (400 jobs). In the first quarter of 2013, government added 200 jobs.
Job losses on island were largest in the retail trade (250 jobs lost), followed by financial activities (150 jobs lost), manufacturing (100 jobs lost) and information (100 jobs lost).
State economists also predict growth in the number of visitor arrivals, although somewhat lower than previously expected.
DBEDT projects that overall visitor arrivals to Hawaii will increase by 4.3% in 2013, down 1.1% from the previous economic forecast.
While total visitor spending is projected to increase — up 5.6% for the yea — that figure is now 1.5% lower than the previous forecast.
The forecast for 2014 visitor arrivals statewide remains unchanged at 2.5%. The forecast for visitor spending in 2014 was lowered 0.2%, to 4.8%, in the current forecast.
In 2012, more than 1.4 million people visited Hawaii Island by air, the largest number to do so since 2007.
In the first quarter 2013, the Big Island has seen 400,441 total visitors arrive by air, which is 20,000 more than the first quarter 2012, and also higher than any other quarter average in 2012.