In its second quarter 2013 economic report, 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 Lim. “From our perspective, we believe Hawaii is poised for steady positive economic growth.”
While the current DBEDT forecast is slightly less optimistic than its February 2013 forecast for some of local economic indicators such as gross domestic product (GDP) growth, job growth, and visitor-related indicators, Hawaii’s overall growth rate is higher than what is being experienced nationally. In addition, the projected personal income growth and inflation rate are unchanged from the previous forecast.
The current forecast for 2013 real GDP for Hawaii is a 2.4 percent growth, and the real GDP growth in 2014 is now forecasted to grow 2.3 percent. Both are within 0.2 of a percentage point from the previous forecast.
For the United States, the consensus forecast by the top 50 economic forecasting agencies in April 2013 projects a 2.1 percent economic growth rate, higher than the 1.9 percent growth rate projected in February 2013. Forecasts for Japanese real GDP growth in 2013 were also more optimistic, which increased from 0.9 percent in the February 2013 forecast to 1.1 percent in the April 2013 forecast.
In the current forecast, Hawaii’s civilian unemployment rate is projected to improve one percentage point from 5.8 percent in 2012 to 4.8 percent in 2013.
The number of non-agricultural wage and salary jobs in Hawaii is now expected to increase 2.0 percent in 2013, 0.2 of a percentage point lower than the growth rate of non-agricultural wage and salary jobs in Hawaii projected in the previous forecast. Non-agricultural wage and salary jobs increased 1.9 percent in 2012.
Forecasts for 2014 are mostly unchanged compared with the previous forecasts. The non-agricultural wage and salary job count is currently expected to increase 1.8 percent, same as the previous forecast.
Following very strong growth in visitor arrivals in 2012, DBEDT projects that overall visitor arrivals will increase by 4.3 percent for 2013, 1.1 percentage point lower than its previous forecast. Total visitor spending is now projected to increase 5.6 percent in 2013, 1.5 percentage points below the previous forecast.
The forecast for the growth of visitor days in 2013 was lowered from 5.3 percent to 3.1 percent, which is primarily attributable to the reduction in air seats from the U.S. mainland.
The forecast for 2014 visitor arrivals remain unchanged at 2.5 percent in the current forecast. The forecast for visitor spending in 2014 was lowered 0.2 of a percentage point to 4.8 percent in the current forecast. Other Indicators DBEDT expects the Honolulu Consumer Price Index (CPI), a proxy for inflation, to rise 2.3 percent in 2013 – same as in the previous forecast.
Since the current forecast of current dollar personal income growth in 2013 was unchanged at 5.0 percent, the real personal income forecast in 2013 was also unchanged at 2.6 percent in the current forecast.
Real personal income growth in 2014 is currently forecasted to be 2.9 percent, same as the previous forecast. Civilian unemployment rate is projected to be 4.5 percent in 2014.
Quarterly Statistical and Economic Report contains more than 100 tables of the most recent quarterly data on Hawaii’s economy as well as narrative explanations of the trends in these data. The full report is available at dbedt.hawaii.gov/economic/data_reports/qser.