UH economists say Hawaii's economy will grow - Hawaii News Now - KGMB and KHNL

UH economists say Hawaii's economy will grow

Rick McMahon Rick McMahon
Carl Bonham Carl Bonham
Tourists enjoy riding Segways in Kailua Tourists enjoy riding Segways in Kailua

KAILUA (HawaiiNewsNow) - All that doom and gloom about our state's economy will likely not be as bad as many thought.

That's what U.H. economists are saying.

Those economists, part of the University of Hawaii's "economic research organization", predict that even with fewer visitors from Japan, Hawaii's economy will continue to grow over the next two years. 

Business has been quite brisk. We've had an up-tick even from last month, especially with our Japanese visitors.

If the economy's been bad and expected to get worse, don't tell that to Rick McMahon at Segway of Hawaii in Kailua.

McMahon shares, "We've already seen a steady increase, call it a momentum, we're into a real stride now".

Like McMahon's business, our economy depends heavily on the visitor industry.

Also, according to Carl Bonham, PhD. / Executive Director of the U.H. Economic Research Organization, "The economy will continue to grow. Not quite as fast as without the disaster in Japan and the rising energy prices".

But it will grow nonetheless.  Carl Bonham leads the group of researchers who put out the quarterly economic forecast.

They concluded that Japan visitor arrivals will fall by 10.8% this year but rebound 10.3% in 2012. 

Overall visitor arrivals should go up by nearly 3% this year and 3.0% the next.

Something on the magnitude of 20% to 25% is directly tied to the visitor industry.

But there is a "wild card" in the report's conclusions, Bonham says.  "We focused on the Japanese economy, but there is this problem with energy costs and rising oil prices that are a risk to this forecast".

For the rest of the year, researchers predict oil prices to stay at about $112 per barrel and drop next year to about $90 a barrel.

Personal income will rise a bit, by 2.1% this year and 2.3% the next.

Job growth won't be great but should also go up thanks to construction jobs from Oahu's rail project.

Things are getting better and people do feel that.

People, like Rick in Kailua.  He employs six and, today 98% of his reservations are from visitors from Japan.  That is definitely something to high-five about.

As a whole, Bonham says, the state's economy should expand by 2.6% through the rest of the year.  That's down just "a tick" from the 2.7% forecast which was made before the disaster in Japan.

 

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