The state has lowered its long-term outlook for total wage and salary job counts in the isles, predicting 1.4 percent growth in 2003, a significant drop from its June forecast of 2.2 percent growth. State downgrades long-term
wage and jobs forecast
By Tim Ruel
truel@starbulletin.comThat revision stands in contrast to an improved outlook on real gross state product. In that category, the state is predicting average growth of 1.85 percent through 2005, compared to a previous estimate of 1.54 percent growth.
Job market conditions typically lag economic recovery, because employers are cautious about increasing their payrolls, according to the state Department of Business, Economic Development and Tourism, which released its latest "Quarterly Statistical and Economic Report" yesterday.
This year, wage and salary jobs will fall by 0.2 percent, the state said. After turning around next year, jobs will rise 1.6 percent in 2004 and 1.8 percent in 2005. Those estimates are also down from the state's June forecast: Previously, for 2004 and 2005, the state had pegged jobs growth at 2 percent.
"The forecast reflects Hawaii's continuing recovery from the effects of last year's national recession and the devastating effects of 9/11 on the travel industry," said Seiji Naya, director of the department. "We have made up much of those losses this year and should complete that recovery in 2003 as long as the U.S. economy remains on track."
The state has also raised its forecast for personal income growth in 2002, predicting a 1.9 percent increase, as opposed to its June growth outlook of 1.5 percent. Personal income is projected to grow at 1.9 percent in 2003, then increase to 2.1 percent growth in 2004.
A recent Bank of Hawaii survey, answered by 303 Hawaii businesses, said 45.3 percent of respondents expected their sales to grow over the next year. About 18.1 percent expected lower sales.
The state left its predictions on visitor arrivals and spending mostly unchanged in the new report. Arrivals are expected to rise 3.5 percent this year to 6.5 million visitors, the beginning of a recovery from last year's 9.1 percent drop. The state predicts arrivals will continue to grow to a record 7.1 million visitors by 2004. The current record is 6.98 million visitors, set in 2000. Visitor spending is projected to hit $11.7 billion by 2004, up 16 percent from $10.1 billion last year.
To account for trends in the U.S. and Japanese economies, which hold tight reins on Hawaii, the state relies on the newsletter Blue Chip Economic Indicators. Based on a monthly consensus of 50 economists, Blue Chip predicts U.S. real gross domestic product will rise 2.3 percent this year and 3.2 percent next year. In Japan, GDP is expected to fall 0.5 percent this year, then rise 0.9 percent in 2003.
The state report is online at www.hawaii.gov/dbedt/qser/index.html.
State of Hawaii
