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The Honolulu Advertiser
Posted on: Sunday, September 7, 2008

LURE OF THE MAINLAND
Islanders bid aloha

By Greg Wiles
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

More residents appear to be leaving Hawai'i because of high living costs, economic slowdown.

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Hawaii news photo - The Honolulu Advertiser
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Hawaii news photo - The Honolulu Advertiser
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Big Island resident Kenji Sanders will fly out of Hawai'i in the next two weeks, leaving behind a place where he grew up in the hopes of finding cheaper housing, better job prospects and a better education for his children in Chicago.

Sanders recently sold his Kailua, Kona carpet cleaning business and is selling off furniture and other items as he prepares to fly out in the next two weeks with his wife and 1- and 3-year-olds.

"I'm going to try and get a leg up over there," said Sanders, who noted there were multiple reasons to relocate 4,200 miles away, including being closer to his wife's family.

He ticks off the list: Rising gas and food prices, home prices that are mostly out of the reach of young families, concerns about public education, a slowing economy and increasing congestion around Kona.

The volcanic pollution that sometimes hangs over the Big Island also is a factor.

"It's just all these things put together."

Sanders, 27, and others like him are one reason why some movers say they've noticed a bump up in their business in recent months.

It's not unusual for Hawai'i to see an outflow of residents, but this year's economic slowdown, along with a surge in real estate prices in recent years, rising inflation and job layoffs may be resulting in higher outbound migration.

THINGS ARE CHEAPER

Reasons vary for moving, but those interviewed said they generally looked at their overall situation and decided the Mainland side of the ledger was more favorable than remaining in Hawai'i. Some say they are hoping the move is only temporary and hope they may be able to return. Others say their departure may be permanent because many years from now it will most likely be less expensive to retire on the Mainland.

For Susan Martinez, who lives at the Ocean Pointe development in 'Ewa Beach, the Mainland means more house for the money, lower food prices and more opportunities for her husband and two children.

A friend of Martinez's moved to Las Vegas recently and reported a four-bedroom home there costs in the low-$300,000 range. That's about half the cost of a single-family residence on O'ahu, where the median price was $635,000 in August, according to the Honolulu Board of Realtors.

The same friend from Pearl City delights in telling Martinez that furniture, groceries and other items are much cheaper.

Martinez is also looking forward to getting a break on her cost of living.

Her husband is in the final application stages of getting a company transfer to a better job in Maryland.

The career advancement means more money and moving to a place where she believes her 5-year-old and 20-month-old kids can be in a better school system.

"Maryland is expensive, but not as expensive as Hawai'i," said Martinez, who has lived in Hawai'i for six years.

While there are no hard statistics that track population inflows and outflows on a monthly basis, there is anecdotal information from movers and shippers about a possible increase in people seeking new lives on the Mainland. Previous data show the number of Hawai'i-born people living in other states has been increasing — figures from the 1980 U.S. Census show 32 percent of people born here resided in other states. By the 2000 census, the number had increased to about 38 percent.

Other figures from the state Department of Business, Economic Development and Tourism show during five of the first seven years of this decade, more people moved out of Hawai'i than moved here from other states, with 9,673 taking flight from the state last year. But the population here increased in each of those years largely because of births outstripping deaths and because of inflows from other countries.

"The net out-migration to the U.S. Mainland is the highest in recent years, with almost 10,000 more people moving from Hawai'i to the Mainland than the Mainlanders moving to the Hawai'i," a DBEDT report said, noting some of the migration was military personnel reporting to new assignments. Some military families also move to be closer to family when one of them is deployed to a war zone.

"One of the reasons why more civilians moved to the Mainland may be attributed to the increasing housing price in Hawai'i, while many places on the Mainland experienced declines."

THE BRAIN DRAIN

The last time the state's population fell was in 1999, as people talked about young educated residents heading for the Mainland in what was referred to as a brain drain. University of Hawai'i Economic Research Organization data shows 1990s state personal income per capita, a proxy for how well Hawai'i's income is performing, fell in five out of 10 years when adjusted for inflation.

The last time real personal income fell was 1996, when it declined 1.5 percent, according to the economic group. It is forecasting the measure will decline by 0.1 percent this year.

"The habit of people leaving here in bad times is well known and probably is growing," said Ricky Cassiday, a housing market researcher. He said many people who leave have family on the Mainland, while those who have grown up here typically have resources to draw upon when they hit financial turbulence.

William Donohoe, owner of the Shipping Shack on Wa'ialae Avenue, said business from walk-in customers who are shipping boxes is off this year, but that people who have him pack up and ship their personal household goods has jumped during the past four months.

"I had three shipments yesterday," said Donohoe, who said people complain that pay doesn't keep up with rising prices here.

"They say they can't afford to live here anymore."

At Hawaii Moving Labor Services, a firm that helps people with packing and shipping of household goods, business has increased for the past three months. Owner Charles Egwuatu said he probably did six or seven Mainland moves a month during the summer last year. He did 11 last month.

"We're seeing quite a lot of increase," Egwuatu said. Not everyone discusses why they are migrating to other states, but Egwuatu said one client recently told him they couldn't take housing prices here.

Where the customer was renting a three-bedroom home in 'Ewa for $2,500 a month, they had found a house in New Mexico for $1,000. Among others, Egwuatu said, some have lost jobs and can't find other work here. Some of the diminished confidence in the state's economy can be traced to its slowing and high-profile job losses among some well-known companies.

JOBLESS RATE STILL LOW

So far this year, more than 5,300 layoffs have been announced by companies ranging from Aloha Airlines to Hawaii Medical Center to The Honolulu Advertiser. The jobless rate edged up to 3.9 percent in July, a five-year high.

That level is low compared with the national rate of 6.1 percent and to be sure, at least one full-service mover says business is level with last year, going against what smaller movers say is a rise in business.

Also, the state Department of Labor and Industrial Relations numbers indicate those laid off are staying here — the number of possible workers here as measured by Hawai'i's seasonally adjusted civilian workforce has been increasing this year.

"We're not seeing the decrease," said James Hardway, department spokesman.

Rebecca Parker, president of mover M. Dyer & Sons Inc., said her business has been pretty balanced this year with about the same number of moves in and out of the state. She said it is possible that smaller movers that specialize in emergency relocations may be busier since some people these days balk at the cost of moving complete households because of the hefty fuel surcharges levied by Matson Navigation and other ocean shippers.

She said such families try to sell off all of their big belongings to get down the amount of weight that needs to be transported.

"It's costing a heck of a lot more to move something from here to the Mainland and back compared to two or three years ago," said Parker, who cautioned against the use of unlicensed movers if people are trying to get the lowest possible cost.

For some people, though, the high costs of moving don't outweigh the need to do so.

Mark Lutwak, 53, is taking a job in October with the Cincinnati Playhouse, after trying to make it here with freelance work and traveling to the Mainland to work as a stage director.

Lutwak moved to the state nine years ago to take a job with the Honolulu Theater for Youth and ended up staying here with his wife, playwright Y York, when that job ended. Lutwak is happy he found a permanent position with a well-regarded theater, and that he will be able to spend more time with his wife in a Victorian home they bought in Cincinnati.

"I was unable to find any significant work in Hawai'i and the traveling was becoming too brutal," said Lutwak, who also plays in the band Kupa'aina. He said he and his wife had been resolved to not leaving the state unless a significant opportunity presented itself.

While excited about his new job, Lutwak said he will miss Hawai'i and hopes one day to return to live here. He said there are many things about the culture, friendships and people here that he will miss.

"Our sense of being ripped away from something is incredibly strong," said Lutwak, a Kane'ohe resident.

"We had had extremely great hopes that this place would turn out to be home for us."

Reach Greg Wiles at gwiles@honoluluadvertiser.com.