STAR-BULLETIN FILE
Low interest rates have made residential construction the industry's hot spot in Hawaii.
Construction
outlook firmThe outlook for the state's construction industry is bright for the immediate future, according to a state economist who spoke to members of a building industry group yesterday.
John Mapes, chief of the economic research branch at the state Department and Business, Economic Development and Tourism, told members of the Hawaii Pacific Steel Framing Alliance that all indicators show a positive forecast for construction.
"The outlook is for increased construction activity in Hawaii in the near future. It appears we are still going up in the construction cycle," Mapes said.
The low cost of borrowing money coupled with increased public demands for housing are two of the main drivers fueling the boom, he said.
Of all types of construction in Hawaii, residential building has the largest share of business, followed by commercial construction, and additions and alterations, Mapes said.
Total private building permits for the first quarter of 2003 increased nearly 95 percent from the same quarter in 2002. The value of residential building permit authorizations was up 70.1 percent statewide for the same period.
Wage and salary jobs in the construction industry also increased statewide during the first quarter, with construction jobs up about 9 percent.
The contracting tax base, which measures construction activity subject to the general excise tax, increased 22.8 percent from the first quarter of 2002 to the first quarter of 2003 with tax paid on $1.1 billion worth of construction in the first quarter this year.
If there is a cautionary note in the otherwise bright picture for construction, it will likely be a shortage of available skilled labor.
"We'll see it over the next couple of years," Mapes said.
With steel framing much of residential housing construction, labor shortages are already being seen in that area, although the industry is working to address the problem, said Ralph Valentino, president of the steel framers association.
