Boom in Tourism Restores Jobs on Kauai

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BY GEORGE COSTA – LĪHU’E – Kaua‘i is finally seeing job growth in its long economic recovery, according to a recent report released by the Office of Economic Development (OED).

The county’s Quarterly Economic Outlook contains the latest indicator data that reflect Kaua’i’s economic activity through the first quarter (Q1) of 2012 and forecasts through the third quarter (Q3).


“The boom in tourism is restoring jobs that were lost during the recession,” said OED Director George Costa. “Going forward, there are ample signs that the mostly flat trends we have been seeing will turn up in the quarters just ahead.”

The total job count in Q1 was 28,100, up 500 from Q1 2011, and this may jump by another 700 jobs in the second quarter (Q2) as this long-term trend has turned up sharply.

Costa noted that the jobs count is one of four key indicators that have moved back above the level they were in pre-boom 2003. The others are income, visitors, and electricity purchases, although all four indicators are still below the peak years of 2006-07.

The clear leader, said Costa, is the visitor segment, where all indicators are trending upward sharply, after hitting a recessionary low point in Q2 of 2010.

The average daily visitor count in Q2 is expected be 23,400, which is 14 percent above Q2 last year, and the Q3 count may actually exceed the peak visitor counts of 2007.

Two other bright spots are the apparent turnaround in spending and income.

Retail sales in Q2 should be up nine percent from 2011 levels, after adjusting for inflation, and income will likely be 22 percent above last year’s Q2 low point.

The number counted as unemployed has also decreased over the past year. The 2,700 unemployed in Q2 will be down 300 from Q2 2011, and should drop by another 100 by Q3 of 2012.

Ken Stokes, an economist with the research firm Island Matters, LLC who compiled the data in the OED quarterly report said, “The upturn in electricity demand is potentially disappointing news. After staying fairly flat since Q1 2011, the trend is turning up again. Demand in Q3 should be 1.8 percent above last year and 5 percent above the baseline 2003 levels.”

Meanwhile, the trend in gasoline purchases has turned back up, and Q2 demand should be 22 percent above Q2 2011.

Home sales and building permits are still near their historical lows, although inflation-adjusted real estate revenues in Q1 were up seven percent from last year, and should hold steady through Q3, and the trend in construction activity has turned up.

Per person, per day visitor spending is roughly the same as last year, with the average in Q2 being around $160.

The average visitor’s length-of-stay is up slightly at 7.82 days in Q3 versus 7.79 last year.

Passenger counts on direct flights are also trending up again after holding at 28,400 for the last two quarters.

For complete details of the Quarterly Economic Outlook, please go to:

George Costa is with Kauai’s Office of Economic Development