Forecast: Hawaii economy to improve in 2010 - Pacific Business News (Honolulu):

tenamup.wordpress.com
Leroy O. Laney addressed a packefd Dole Cannery Ballroom on Wednesday morninfg at the 39th Annuaol Business Outlook Forum sponsored by the The downturn inHawaii — a result of high oil prices, mass layoffs and the exit of cruise shipsd and airlines — follows 11 consecutivde years of expansion, two years longer than the last one that ended in the early 1990s. The visitorr industry should expect a 9 percent drop in arrivals in 2008 andanothef 5.5 percent drop next year. “With national a further 5 percent contraction in total arrivalsw next year could be all we canhope for, with a full-fledged recovery in Hawaii’s mainstayt industry as 2010 rolls he said.
Hawaii has learned not to expect too much fromJapanesr arrivals, which have declined steadily over the past however, if Mainland uncertainty and higher airfares continue, a mildeer contraction in domestic arrivals could be as well, he said. Job growtgh in 2008 will be flat over the previoue year and is expected tofall 1.2 percent in 2009. The unemploymentt rate, which typically lags the overallp economy, will rise to 5.5 percentr in 2009, where “it might remain for a following an unemployment rate of 4 percentyin 2008. High home prices, whicn cranked up inflation in 2006 afteesteady growth, will be replaced by soaring energy costs over the next putting the inflation rate at 3.
5 Inflation this year will be 5 percent higherd than last year. Real personal incomre in 2008 will fall slightly at 1 percen over the previous year and is expected tofall 1.5 percentf in 2009. Construction has been winding down in most areas sincde 2006 and will be further affected by higher buildin costs and tightercredit markets. Privat residential permits have droppedx for fourstraight quarters, and potential builders have adoptexd a “wait and see” attitude.
Laney said home prices are expectede to continue declining in 2009 butin “modesy amounts,” resulting in more affordabled homes for buyers in a market where pricesx typically are high and incomes are lower than other “That’s positive for long-term he said. “This is a trade-off that Hawaii alwayss has faced andalways will.” Laney said that in his 18 yearse of economic presentations for the this year’s is the most uncertain. “The only year I can thini of that equals that uncertainty is the forecasft I presented immediatelyafter Sept. 11. So we are going to be watchinyg 2009 unfold with highlyconcentrated attention,” he said.