Posted on: Friday, August 23, 2002

Big Island jobs intact throughout 9/11 fallout

By Hugh Clark
Advertiser Big Island Bureau

HILO, Hawai'i — The Big Island businesses weathered the economic fallout since the Sept. 11 terrorist attacks without a loss of jobs, and the outlook for next year is promising.

Construction on both sides of the island — led by luxury homes worth up to $8 million each in West Hawai'i — plus Kona's growing ocean and energy development park at Keahole, as well as farming and dairy operations, helped bolster the island's economy, according to participants at Hawai'i County's 28th Business Outlook Forum yesterday.

A dramatic increase in cruise-ship visitors to Hilo — from 98,000 in 1998 to a projected 215,000 this year — and heavy educational investments in Puna also offer hope for the future,said David Hammes, an economics professor at the University of Hawai'i-Hilo School of Business.

"The economy on both sides of the island is treading water, somewhat more buoyantly on the west side than the east, but treading all the same," Hammes told members of the Hawaii Island Chamber of Commerce in Hilo and Kona-Kohala's Chamber of Commerce in Keauhou.

Leroy Laney, a consultant to First Hawaiian Bank, said the economic impact from Sept. 11 has been less drastic than many, including himself, had expected.

Laney said one factor it has highlighted is that it's time for tourism to reduce its focus on Japan. He noted that much of Hawai'i's economic resilience since Sept. 11 can be attributed visitor arrivals from the U.S. Mainland — mostly California, Washington state and Texas.

And while the island's economy may not be booming, Laney said he sees promise in the way businesses have sustained 66,000 jobs — 35,000 in East Hawai'i and 31,000 in West Hawai'i.

Hammes noted four projects at UHH that may bring in nearly $200 million to the island — including a China-U.S. Center approved by regents last month that will double dormitory units from 660 to 1,400 and is projected to generate $60 million in outside spending. He also cited the long-pending permanent facility for the federal Pacific Basin Agriculture Center that eventually will create 100 jobs and cost around $55 million.

Another economic impetus is the rapid increase in foreign students enrolling at UHH, he said. The number is expected to reach 400 this fall, which would give UHH the third-highest percentage of foreign student enrollment in the country behind Hawai'i Pacific University and Columbia University in New York, according to Hammes.

UHH foreign students mean $13.5 million more each year for the island economy, Hammes said.

Meanwhile, Kamehameha Schools last year spent $30 million to launch its East Hawai'i campus in Kea'au. Kamehameha is expected to spend a similar amount in additions this year.