It could be a glimmer, or maybe just wishful thinking. But there are some signs that Hawai'i's economy may be reaching the bottom of a pernicious downturn that's ravaged employment rolls and uprooted some companies.

No one is saying the economy has reached a recovery. But they note the steady worsening of the state's economy may be ending, perhaps paving the way for a return to growth next year.

At Olsten Staffing Services in Honolulu, the phone is starting to ring a bit more often. Olsten and other temporary help firms had seen business decline over the past year as firms cut back on hiring and laid off people.

But lately there's been word that companies aren't laying off as many people and in some instances are hiring.

"There's a few more orders coming in for people," said Olsten President Signe Godfrey.

"I'm not going to say it's great, but we're starting to see a little more uptick, which we haven't seen in a long time."

There are other signs the long economic winter is beginning to thaw with automobile dealers reporting a rise in buyer traffic generated by the "cash for clunkers" program. This, after a precipitous decline in sales over the past two years.

The number of airline seats on scheduled flights to Hawai'i on a rolling three-month basis has increased in the past two monthly reports from the Department of Business, Economic Development and Tourism. There had been 14 months of consecutive declines in the report.

HOPEFUL SIGNS

Domestic visitor arrivals have stabilized in recent months on a seasonally adjusted basis, and O'ahu home and condominium sales are rising, said Paul Brewbaker of TZ Economics.

At the same time, the number of jobs being lost in the downturn has been shrinking this year, he said. In December the state's economy lost 6,400 jobs. By June that had shrunk to a loss of 2,550.

Brewbaker said his seasonally adjusted sales volume number for residential real estate shows the bottom may have been reached around the beginning of the year, as the data shows increases every month since then.

"There's an increasingly broad pattern of stabilization," Brewbaker said.

Where Hawai'i is positioned in the economic cycle may be best illustrated through the alphabet.

Brewbaker said a decline and sharp rebound would have a V-shape, while an L-shaped curve would denote a economy that's declined and has been stuck at a low level of activity.

His view is the Hawai'i economy is now along the bottom of a U-shaped economic cycle where there is a decline, a period of stabilization and then renewed growth.

"If it's U-shaped, then we're going from one arm to another," Brewbaker said. "It's certainly not V-shaped.

"No one is saying it's L-shaped. That's what everyone was saying six months ago."

Alphabet soup aside, there are other factors pointing to the downturn hitting bottom. Brewbaker said Hawai'i's economic cycle has increasingly been synchronized with the overall U.S. economy after previously being thought to lag the Mainland.

On Friday the U.S. Labor Department issued a report that many people took as further proof that the recession is ending. It reported the fewest number of jobs were lost in a year's time and that worker hours and pay had edged upward last month.

That led President Obama to pronounce the worst of the economy may be behind the country. The Standard & Poor's 500 Index has risen 11.9 percent since the beginning of the year.

"I think there's more positive news than we had been seeing in the last year," said Pearl Imada Iboshi, state government's chief economist.

"If you go to Waikiki, it seems really crowded, at least this month. Definitely flights have been really full coming in and out of Hawai'i."

Iboshi, who heads the economic team at the state Department of Business, Economic Development and Tourism, forecast in May that Hawai'i's gross domestic product will decline this year, but will grow next year. It has similar projections for upturns next year in visitor expenditures and personal income.

The state will issue an updated forecast later this month, though Iboshi said she does not know at this time if any of the estimates will be revised upward.

STILL CLOUDY

To be sure, there is some economic news that continues to be bad and figures to be that way for months to come.

Unemployment was at 7.4 percent in June, a 31-year high, and may get worse since employers are hesitant about new hiring until they are convinced the economy has turned around.

While domestic arrival numbers are stabilizing and there are signs the recent Japanese imperial visit may have allayed Japanese travel fears about the H1N1 virus, tourism spending numbers were off by 16.1 percent in June.

Hawai'i's construction industry is still mired in a vexing slump, with the value of residential and commercial building permits down 43 percent compared with a year ago.

Then there is the tax revenue declines for state government and questions about talks between Gov. Linda Lingle's efforts to cut labor costs through talks with public unions.

Brewbaker said the unsettled nature of whether there will be furloughs, layoffs, further spending cuts or a tax increase can dampen the state's recovery.

The dispute is likely to produce headlines for weeks and months to come and highlight one of the state's economic problems. That's bad because it could keep holding down spending by workers and others who are possibly affected, as well as crimp other investment, Brewbaker said.

"Any significant source of persistent uncertainty is problematic," he said.

He said there are other threats that could possibly derail an improvement in the state's economic environment, including a jump in oil prices that forces airlines to raise airfares.

Still, many are hoping the worst is behind us.

"I think the spiraling down has stopped," said David Rolf, executive director of the Hawaii Automobile Dealers Association. "We're no longer losing additional sales."

Car dealers have been hammered in the current economy and recently welcomed the "cash for clunkers" program in which consumers can get up to $4,500 toward the purchase of a new car when they turn in their older, less fuel-efficient vehicle.

Joe Nicolai, president of JN Group Inc., said June was better than April or May, but that July was horrible. He said this month has seen a big jump in customer traffic and sales.

"If it continues, as far as I'm concerned, we're not in a recession anymore," said Nicolai, noting he fears customer traffic will dry up again once the federal program ends.

A report done for the auto dealers group found that the sales decline reached bottom in December when sales totaled about 2,600 vehicles. Since that time, sales statewide have averaged about 100 more on a monthly basis. An upturn is projected for next year.

"It's not going to be an instant recovery," Rolf said.

"It's going to be a long road from here, and it's a process that's just beginning."