EconomistsA collection of local economists fed Hawaii's legislators a big dollop of economic comfort food today as they predicted more jobs in the coming year.
The state is preparing a
budget that exceeds its spending
ceiling during the next
three fiscal years
By Richard Borreca
The good news has already been factored into the state's $12 billion budget proposed for the next fiscal year.
Legislators also heard from the state budget chief, Neal Miyahira, who said the state is preparing a budget that exceeds the state spending ceiling during the next three fiscal years.
The state will spend the extra money because of "emergency program requirements in the Felix consent decree, health and human services," Miyahira said.
Appearing before a joint session of the legislature's House and Senate money committees, the economists said most of the good news comes from forces not influenced by local government.
Real estate prices and construction have turned up, noted Lawrence Boyd, a labor economist with the University of Hawaii's Center for Labor Education.
"It is possible that the Hawaiian economy is in the best shape it possibly has ever been in," he said.
"The relatively low inflation and high employment we have today is the result of a long process in which the private sector has worked through many of these problems," he said.
Paul Brewbaker, Bank of Hawaii vice president and chief economist, agreed with the pleasant predictions: "After all is said and done, 2001 will be a reasonably good year for Hawaii's economy, the best in a while."
Brewbaker calculates that Hawaii's personal income growth rate was 3 percent last year.
"This is the highest growth rate since economic momentum in Hawaii began in 1997."
The state's own economists, led by Seiji Naya, director of the Department of Business, Economic Development and Tourism, predicted that the economic recovery will continue. His latest forecast is based on a quarterly statistical and economic report that estimates 2.7 percent overall growth in 2001.
Naya predicted moderate but sustainable growth.
All that money will be needed for the latest version of the state budget being prepared by Gov. Ben Cayetano.
Miyahira said the new figures from the state's Council on Revenues have been added to the budget, but "obviously a prudent spending policy is still in order."