State Upbeat About Hawaii’s Economic Future
A low inflation rate is keeping Hawaii’s economy strong, said a third quarter 2014 report released today by the state Department of Business, Economic Development and Tourism.
“Hawaii’s inflation rate (1.1%) was lower than the US average for the first time since 2003,” said a prepared statement from DBEDT Director Richard C. Lim.
“At the same time, our labor market continues to improve. We are seeing a record-high labor force and workers employed during the first seven months of this year,” he said.
Hawaii’s unemployment rate also remains one of the lowest in the nation, DBEDT noted. Through July this year, non-agricultural payroll jobs increased by nearly 7,000 compared with the same period last year, with many industries adding jobs, the report said.
Though economic indicators continue to be mixed during the first half of 2014, DBEDT economists see positive signs for the second half.
Despite a net loss of 100 jobs in the construction sector, the total value of private building permits increased by 7% through July 2014, indicating more construction activity in coming months.
The unemployment rate for the first seven months of 2014 was 4.5%, and DBEDT analysts predict it will drop to 4.3% for 2014, 4% in 2015, and slip below 4% thereafter.
Though landfall of Tropical Storm Iselle and the threat of Julio resulted in 13,500 visitor reductions for the two days of Aug. 7 and 8, visitor counts are quickly recovering, the DBEDT report said.
Visitor arrivals during the first half of the year were down half a percent, but the number of scheduled air seats is expected to increase by more than 5% during the second of half of 2014, indicating a record 8.3 million visitors and $14.9 billion in spending for the year, the DBEDT release said.
DBEDT expects the consumer inflation rate to remain low for the next few years at 1.5% in 2014, 2.2% in 2015, and gradually increasing to 3% by 2017.
At the same time real personal income growth is projected to grow at 2.6% in 2014, higher than the 2.1% projected in DBEDT’s previous forecast. For 2015, the new projection is 2.5%, also higher than the 2.2% projected last quarter.