Hawaiʻi's economic outlook presents a mixed picture as recovery efforts in Maui lag behind the rest of the state. Following the devastating wildfires, Maui's economy is gradually rebounding, but challenges remain. The University of Hawaii Economic Research Organization (UHERO) released its Q3 2024 forecast, indicating a slowdown in overall growth trends due to limited population and labor force expansion. While other counties in Hawaiʻi maintain robust visitor industry levels, Maui hotels are experiencing declining occupancy rates, contributing to a 5% drop in the labor force, equating to a loss of about 4,200 workers [f3fe9a55].
Statewide tourism figures have seen a slight decrease, although Oʻahu experienced a summer boost in visitor numbers. The ongoing housing affordability crisis in Maui exacerbates the economic challenges, as residents struggle with rising costs. Despite these issues, real personal income in Hawaiʻi is expected to rise by 1.4% in 2024, indicating some resilience in the face of persistent inflation [f3fe9a55].
The global economic landscape remains varied, with the U.S. economy showing unexpected strength. However, the recovery of Japanese visitors to Hawaiʻi remains at only half of pre-COVID levels, highlighting ongoing challenges in the tourism sector. Long-term growth in Hawaiʻi is hampered by an aging population and low per capita income growth, with real GDP projected to increase by 2.8% in 2025. Potential cuts to Federal interest rates could provide some relief to Hawaiʻi's economy, but the looming risk of a U.S. recession continues to pose a threat [f3fe9a55].