The number of visitors to Hawai'i dipped 1.2 percent last year to 7.37 million, confirming an expected slowdown in the state's top industry, according to the state Department of Business, Economic Development and Tourism.

Visitor spending rose 0.9 percent to $12.2 billion in 2007, the agency reported. But that was not enough to keep pace with inflation in Honolulu which was estimated to be about 4.5 percent last year.

State tourism liaison Marsha Wienert said officials track the numbers without the increased cost-of-living factor to be consistent but are aware that figuring in the inflation rate means industry growth has slowed for some time.

Although Honolulu doesn't have a strict visitors-only price index, using the Honolulu consumer price index adjusts last year's rate to expenditures of minus 3.6 percent she said.

Local retailers are feeling some of the effects in their stores.

Cinnamon Girl is a locally owned specialty women's boutique that has seen business shift to a broader mix of customers for its clothing.

Ala Moana store manager Lei Orosco said visitors are still a big part of their business but now they are coming from different countries. "It used to be we got a lot of Japanese visitors. It's more of a mixture now," with more Canadian, Australian and Chinese travelers.

The biggest increase last year was in arrivals from Canada, which rose 5.3 percent to 288,150. Arrivals from Japan decreased 3.5 percent to 1.3 million. Arrivals from the Western U.S. rose 0.1 percent to 3.2 million, while arrivals from the Eastern U.S. dropped 3.3 percent to 1.9 million.

The average length of stay was virtually unchanged from 2006 at 9.15 days. The number of total visitor days fell to 67.4 million, a 1.6 percent decline from a year earlier.

Although overall visitor arrivals fell in December, the number of tourists who arrived by cruise ship soared. The state welcomed 501,696 visitors on cruise ships, a 21 percent increase from 2006. However, the cruise industry is bracing for a big blow when NCL's Pride of Hawaii leaves interisland service next month.

NCL America announced last year it would pull the ship from Hawai'i in the face of mounting financial losses. The Pride of Hawaii sailed on Monday for Los Angeles. It will be reflagged and renamed Norwegian Jade before it is redeployed to the European cruise market.

For December, visitor arrivals fell 2.7 percent to 649,159, while spending rose 3.2 percent to $1.2 billion. The average daily visitor spending for December grew from $179 a person in 2006 to $183 a person last year.

The preliminary statistics also showed that in December, visitors stayed a little longer — 10.07 days compared to 9.68 days from the previous year.

Among the top four visitor markets, arrivals from Canada jumped 19.6 percent in December, while the U.S. West declined 5.2 percent, the U.S. East fell 7 percent and Japanese visitors dropped 3.8 percent compared to December 2006.

Total arrivals from all other geographic areas rose 7.6 percent, officials said.

"Hawai'i's visitor industry remained stable in 2007 especially coming off of two robust years of growth," Wienert said. And she is encouraged by ongoing growth in the number of visitors from markets such as Canada, Hawai'i's fourth-largest market, and the strong performance of Hawai'i's cruise industry.

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