91Ö±²¥

91Ö±²¥’s economy is expected to continue growing over the next several years, though at a slower pace than in 2025, according to a new quarterly economic report released Thursday by the state Department of Business, Economic Development and Tourism.

The department’s first-quarter 2026 Statistical and Economic Report projects the state’s real gross domestic product will grow 1.7% in 2026 and 1.8% in 2027, following an estimated 2.6% expansion in 2025.

Economists said the state’s economy remained resilient through 2025, supported by a strong labor market, rising personal incomes and steady visitor spending. However, federal policy uncertainty and global developments — including geopolitical tensions — could slow the pace of growth.

“91Ö±²¥’s economy continues to demonstrate resilience, supported by a solid labor market, rising personal incomes, continued construction activity and steady visitor spending,” DBEDT Director James Tokioka said. “At the same time, the pace of economic expansion is expected to moderate in the near term as federal policy and global economic conditions evolve.

Despite those challenges, Tokioka said the state remains positioned for continued growth.

“Visitor spending remains robust and the state’s December unemployment rate was the lowest in the nation,” he noted. “Construction activity will continue to grow due to government contracts as well as residential projects, including the thousands of units in the state’s affordable housing pipeline.”

91Ö±²¥’s labor market showed continued strength at the end of 2025. The civilian labor force reached about 690,050 people in December, up 1.2% from the previous year, while civilian employment rose 1.8% to about 674,700.

The state’s unemployment rate was 2.2% in December 2025, significantly lower than the 4.1% national unemployment rate.

Total nonagricultural wage and salary employment reached 661,800 jobs, an increase of 6,600 jobs compared with December 2024.

The largest job gains were in natural resources, mining and construction, which added 3,100 jobs, followed by health care and social assistance with 2,900 jobs and food services and drinking places with 2,100 jobs.

Government employment was mixed. State government employment was largely unchanged, while the local government added 300 jobs. Federal government employment declined by 3,400 jobs during the same period.

Personal income also increased in 2025. In the third quarter, nominal personal income grew by $4.6 billion, or 4.5%, compared with the same quarter a year earlier.

Average personal income for the first three quarters of 2025 reached about $107.5 billion, a 5.2% increase from the same period in 2024. Per capita personal income rose to $74,830, up 4.6%.

Inflation in Honolulu also moderated during the second half of the year. The Consumer Price Index for Urban Consumers rose 2.3% compared with the same period in 2024, below the national average increase of 2.8%. In January 2026, inflation in 91Ö±²¥ was measured at 2.4%.

Economists noted that while price pressures have eased, risks remain tied to tariffs and potential energy price shocks connected to global conflicts.

Tourism trends were mixed at the end of 2025. Visitor arrivals by air declined 3.2% in the fourth quarter compared with the same period in 2024, largely due to a drop in domestic travel.

However, spending by visitors increased. Air visitor expenditures reached $5.6 billion in the fourth quarter, an 8.5% increase year over year. Total visitor spending for 2025 reached $21.7 billion, up 5.8% from 2024.

More recent data suggests a stronger start to 2026. In January, the state recorded 874,358 visitor arrivals, including more than 858,000 arrivals by air.

Visitor spending that month totaled $2.3 billion — about 19% higher than January 2025.

The construction industry also showed growth, with employment rising by about 2,700 jobs, or 6.9%, in the fourth quarter of 2025 compared with the previous year.

Government contracts awarded increased 24.7% during the quarter, while residential permits for the year rose 3.1% and commercial and industrial permits increased 26.7%.

Housing prices showed mixed trends. In February 2026, the median price of a single-family home in Hono­lulu increased 1.7% to about $1.2 million, while the median condominium price rose 1.2% to about $500,000.

Looking ahead, the report forecasts steady but moderate economic growth through 2029.

Visitor arrivals are expected to increase 0.8% in 2026 and about 0.9% annually from 2027 through 2029. Visitor spending is also projected to continue rising.

Employment is forecast to increase gradually to about 672,900 nonagricultural jobs by 2029, while the unemployment rate is expected to remain low at roughly 2.4% to 2.6%.

Tokioka said the department will continue tracking economic trends as conditions evolve.

“Looking ahead, DBEDT expects moderate but sustained economic growth as visitor activity gradually increases, inflation pressures ease and business growth continues across several sectors of the economy,” he said.