Economic growth forecast a mixed bag
By John Duchemin
Advertiser Staff Writer
The state government has raised its forecasts for Hawai'i job growth, but lowered its predictions for visitor arrivals and tourism spending over the next several years, and said the overall economic growth outlook remains mixed.
The state now forecasts growth in the gross state product the total value of goods and services produced in Hawai'i of 2.8 percent in 2001, 2.7 percent in 2002 and 2.5 percent in 2003, according to the latest economic forecast prepared by the Department of Business, Economic Development and Tourism.
That's a mixed bag. On the one hand, those growth rates are slower than the 2000 increase of 3 percent, to an inflation-adjusted $34.9 billion. On the other hand, the 2001 increase projection is higher than previously estimated.
The 2002 and 2003 estimates, however, are revised downward. The weaker Japanese yen and California's energy problems are main reasons for the slightly dampened long-term outlook, government officials said.
"Our current forecast is consistent with slower, but still reasonable, growth," said Seiji Naya, director of the Department of Business, Economic Development and Tourism.
Hawai'i should add about 2 percent per year to its job count or about 11,000 jobs per year through 2004, the department predicts. That's up from previous predictions, which called for about 10,000 new jobs per year.
Thanks to worldwide economic uncertainty, however, the department predicts the tourism industry will grow less quickly than previously expected. The state now expects tourism expenditures to grow by 6 percent in 2001 and 5 percent each of the next three years. In fourth-quarter 2000, the department predicted annual growth above 8 percent through 2003.
Likewise, visitor arrivals, previously forecast to grow 3 percent or more per year, are now forecast to grow above 2.5 percent per year.