Posted on: Monday, November 5, 2001

Hawai'i salary growth not as high as hoped

By Kevin Dayton
Advertiser Capitol Bureau Chief

Hawai'i residents' salaries and other incomes won't be growing as quickly this year as state officials had hoped.

Official estimates of personal income growth in Hawai'i have been scaled back, with a panel of economists predicting the state economy will be particularly hard hit in the last three months of this year and the first three months of next year.

The state Council on Revenues earlier had predicted personal incomes in Hawai'i would grow by an average of 5.5 percent this year, but scaled that back to 3.5 percent.

Total personal income last year was $34 billion, which means the council's new prediction points to income growth that would be $680 million less this year than the council earlier predicted.

Economists cited low visitor counts from Japan as the main problem with the economy at the moment. Arrivals from Japan were shocked by the Sept. 11 terrorist attacks, and have been running about 40 percent of last year's level.

The council predicted personal income will grow by 2 percent next year. That is a significant downgrade of the council's earlier prediction that personal income would grow by 5.5 percent next year.

The council is panel of economists responsible for predicting state tax collections each year, and personal income tax is one of the two largest sources of tax collections for the state.