By Staff Reports
(Kauai)– According to a report released today by the Office of Economic Development (OED), Kaua’i’s economic activity will likely continue to rebound in the coming months with a few exceptions.
The Quarterly Economic Outlook contains recent trend data and short-term forecasts for Kaua‘i. The report was prepared for the county by Island Matters LLC.
“The good news is that the economic recovery from the Great Recession three years ago for the visitor industry has been better than originally forecasted”, said OED Director George Costa. “The sobering news is that this growth trend is likely to soften, and return to modest growth increases by year end.”
The average daily visitor count in the fourth quarter of 2011 was 20,400 and is expected to be 20,900 in the fourth quarter of 2012. This represents a 2.5 percent increase over the same period last year.
The visitor industry propped up Kaua‘i’s economy during this recovery period and the visitor per person per day spending was a major contributor to that with a 3.5 percent increase in the second quarter of 2012, which will likely continue its upward trend.
For the first time, Kaua’i may see a downturn in the number of passengers arriving on non-stop flights from the continent, which averaged 38,400 per month in the fourth quarter of 2011 and may fall to 32,000 in the fourth quarter of 2012.
Also trending downwards is the average visitor’s length-of-stay, which was 7.6 days in the fourth quarter of 2011 and may fall to 7.1 days in the fourth quarter of 2012.
“Potentially good news lies with the downward trend in electricity demand,” said Costa. “After a modest uptick in demand early in 2011, the second quarter of this year saw a one percent reduction in demand. Hopefully the reduction is a result of a conscious effort to conserve energy use, as well as the increase in oil and gasoline prices.”
The average monthly electricity demand was 35.2 gigawatt-hours, which may fall to 34.2 GWh in the fourth quarter.
Ken Stokes, an economist with the research firm Island Matters, LLC who compiled the data in the OED quarterly report said, “We’re finally seeing a return to income growth, and the fourth quarter income trend should be almost 20 percent above last year.”
He noted that the total job count in the second quarter of 2012 was 28,300 up 400 from the same period in 2011, and may climb an additional 100 jobs in the fourth quarter of this year.
“The job count is one of three key indicators that have climbed back above the pre-2003 economic boom levels,” said Stokes. “The others are income and visitors, although jobs are still well below the boom years of 2006 and 2007.”
The quarterly report also shows that the slump in building permits has turned around and is now trending up, while home sales are still trending down.
For complete details of the Quarterly Economic Outlook, please go to the county website, www.kauai.gov.