Manoa Valley resident Jon Matsuyama has been making the equivalent of about $105,000 annually, his housing is provided and so are meals.

That's the upside in a Hawai'i economy of increasing layoffs and pay cuts.

The downside is that as a soldier in Kuwait, he's largely confined to life on a U.S. military base, his wife and 2-year-old son are back in Hawai'i, and he'll be back to lower civilian pay this summer.

Matsuyama, a 36-year-old staff sergeant who works with security forces at Camp Arifjan, is one of about 1,700 Hawai'i Army National Guard and Reserve soldiers who were mobilized for a year of federal active duty.

The citizen soldiers arrived in Kuwait in October and November, and will return home in July.

At least economically, the deployment has benefited the vast majority of the Hawai'i National Guard's 29th Infantry Brigade Combat Team.

SOME TAKE A CUT

Myra Hethcote, who works in mobilization pay support with the Hawai'i unit, said about 85 percent are making more pay compared with their civilian jobs back home.

The remaining 15 percent, with some lawyers and other higher-paying jobs among their ranks, experience a pay cut, Hethcote said.

"It's definitely a step up. I probably make three times as much as I make back home," said Matsuyama, who is an overnight manager at Star Market in 'Ewa Beach.

The pay rates for all the deployed "weekend warriors" are impressive. A sergeant with a spouse, rent or a mortgage back in Hawai'i, and more than eight years in the Guard, makes about $73,250 largely tax-free while in Kuwait, officials said.

A second lieutenant — the lowest rank in the officer corps — with just a few years in and no dependents receives about $75,000.

A captain with more than eight years in and a dependent is paid nearly $112,000 in a combat zone.

A private first class — who still may be a teenager — makes $52,200 if he or she has a rental agreement back in Hawai'i, and $33,500 if there is no rental obligation.

Housing allowance is a key factor, often adding $2,000 or more a month, while hardship duty and "hostile fire" pay for the Hawai'i soldiers equates only to $325 a month.

The pay rates in locations including Kuwait, Iraq and Afghanistan are the same whether a soldier is in the National Guard or regular Army.

Because of his length of service, Matsuyama gets about $7,000 a month mostly tax-free while he's in Kuwait. Tax preparers say the equivalent for a civilian back in Hawai'i — who would be paying taxes — is about $105,000.

The soldiers do pay some Social Security and Medicare taxes, Hethcote said.

Reducing the amount that Matsuyama receives, though, is the fact that the soldiers won't be in Kuwait for a full year.

With the train-up beforehand and demobilization back home, the time spent with the mostly tax-free income in Kuwait is closer to eight or nine months.

Capt. Jeff Hickman, a spokesman for the Hawai'i National Guard, said the public generally would be surprised at the pay levels for the part-time soldiers when they're on full-time mobilized status.

Back home, the Guard soldiers typically get paid for two days of training per month and two weeks of annual training per year, and have civilian jobs or go to college.

"With today's hard times, (the overseas pay) would make a lot of people look at themselves and go, 'Wow,' " Hickman said. "I also think the public would be impressed with the amount of work people actually do in country."

HELPS RECRUITING

Beth Busch, who is with Success Advertising Hawai'i, which puts on the state's largest job fairs, was shocked at the pay for a sergeant at $73,250. Soldiers with that rank are usually in their 20s.

"That's a lot. Everybody is going to be signing up," she said only half jokingly. "We'll have a run on the Army recruiting place."

She added that anybody living in Hawai'i making $70,000 or $80,000 "is doing well — above average,"

"But if you take into consideration the interruption of their lives, I don't think it's too much. It surprises me. I think they are well compensated, but I don't think it's the sweetest deal ever," Busch said.

COMBAT DEPLOYMENT

Three years ago, when the 29th brigade returned from a year in Iraq and Kuwait — its first combat deployment since Vietnam — the Guard braced for an exodus in what were then better economic times.

At the end of fiscal 2008 in September, the Guard not only had met its recruiting and retention goals, but had its best recruiting year in at least five years, officials said.

The incentive to re-enlist in a combat zone also is financially attractive.

Brigade spokeswoman Maj. Pam Ellison said 34 soldiers have reupped in Kuwait, qualifying for $7,500 tax-free for three extra years of service, and 141 qualified for $15,000 bonuses for six extra years.

Kuwait duty is relatively safe, but deaths and injury have occurred — as was the case with the Feb. 19 single-vehicle accident that killed Spc. Cwislyn K. Walter, 19, a 2007 Farrington High graduate, and injured three other soldiers in the sport utility vehicle.

About 1,200 of the Hawai'i National Guard and Reserve soldiers make frequent trips up into Iraq providing security escort for convoys. A handful have been injured in attacks.

Matsuyama said he's able to save enough money that he's hoping it will add up to a down payment for a house when he gets back. He rents now.

"The family separation — that's the down side," said Matsuyama, who re-enlisted for six years when he was in Iraq with the National Guard in 2005.

Now he has a 2-year-old son, Hunter, his first child.

"He's talking a lot and he's coming around, so it's kind of hard to not be there for him," Matsuyama said by phone from Camp Arifjan. "Before I deployed, we were buddies. Whenever I went to do errands, he went with me."

MISSING FAMILY

Matsuyama saw in friends on the last deployment how much they missed their kids, and now he's experiencing it himself.

The staff sergeant has seven soldiers under him, and he tries to help them plan financially because they, too, are making good money.

"It's money that they never had or made before," he said.

Some auto and motorcycle dealers do business on base and arrange to have a new car or bike waiting for returning service members.

Another member of the security force at Arifjan is 2nd Lt. Kevin Inoue, 25, who said he was living with his mom in Mililani, but is saving for a townhouse.

Inoue went through ROTC at the University of Hawai'i, graduated in 2007, worked as a recruiter for seven months, went to officer school and then deployed to Kuwait, so he has no job waiting back in Hawai'i.

"It's kind of scary knowing when I get back home, I'm going to be pretty much unemployed," Inoue said. "So a lot of us are actually thinking about extending (in Kuwait) for another six months."

About 30 of the Guard soldiers in his company of 130 are considering staying on with the Wyoming National Guard unit that will replace the Hawai'i soldiers, he said.

The economy back home is factoring into a lot of the soldiers' planning, and Matsuyama has his family in mind.

"That's why I implemented a financial plan — so I have (savings) to fall back on," he said. "If I'm unable to get a mortgage or a house when I get back, I have something to cushion us if we need a cushion."