{"id":165762,"date":"2022-09-23T00:01:54","date_gmt":"2022-09-23T10:01:54","guid":{"rendered":"https:\/\/www.hawaii.edu\/news\/?p=165762"},"modified":"2022-09-23T00:03:05","modified_gmt":"2022-09-23T10:03:05","slug":"uhero-third-quarter-forecast","status":"publish","type":"post","link":"https:\/\/www.hawaii.edu\/news\/2022\/09\/23\/uhero-third-quarter-forecast\/","title":{"rendered":"U.S. recession to weigh on Hawai\u02bbi\u2019s economic recovery"},"content":{"rendered":"<span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Reading time: <\/span> <span class=\"rt-time\"> 2<\/span> <span class=\"rt-label rt-postfix\">minutes<\/span><\/span><p><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.hawaii.edu\/news\/wp-content\/uploads\/2022\/03\/manoa-uhero-forecast-first-quarter-2022.jpg\" alt=\"buildings and ocean\" width=\"676\" height=\"381\" class=\"alignleft size-full wp-image-156111\" srcset=\"https:\/\/www.hawaii.edu\/news\/wp-content\/uploads\/2022\/03\/manoa-uhero-forecast-first-quarter-2022.jpg 676w, https:\/\/www.hawaii.edu\/news\/wp-content\/uploads\/2022\/03\/manoa-uhero-forecast-first-quarter-2022-300x169.jpg 300w, https:\/\/www.hawaii.edu\/news\/wp-content\/uploads\/2022\/03\/manoa-uhero-forecast-first-quarter-2022-130x73.jpg 130w\" sizes=\"auto, (max-width: 676px) 100vw, 676px\" \/><\/p>\n<p>A new forecast by the <a href=\"https:\/\/uhero.hawaii.edu\/\">University of <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> Economic Research Organization<\/a> (<abbr>糖心视频ERO<\/abbr>) reveals a darker economic horizon for the state since its <a href=\"https:\/\/www.hawaii.edu\/news\/2022\/05\/12\/uhero-quarter-2-forecast\/\">last forecast in May<\/a>, due to the global economy slowing sharply, and the U.S. heading for a mild recession in the first half of next year.<\/p>\n<p><span aria-label=\"Hawaii\">Hawai&#699;i<\/span> may escape overall net job losses, thanks to the recovery of visitor travel from Japan, which is now underway. But high inflation, higher travel costs and the Fed\u2019s interest rate hikes will still adversely impact <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> households and businesses.<\/p>\n<p>Highlights of the September 23 report:<\/p>\n<ul>\n<li>The global outlook has worsened significantly since the last report. Persistently high inflation is causing central banks to raise interest rates more sharply than expected. Russia\u2019s war with Ukraine has inflicted an energy crisis on Europe, which is now clearly headed for recession. China\u2019s economy continues to suffer from its zero-COVID policy. Global growth has slowed to about 3&#37; this year and will soften further in 2023.<\/li>\n<li>The U.S. is not yet in a recession, but one is anticipated in 2023. In the face of 8&#37;-plus inflation, the Fed will make additional large interest rate hikes, sharply reducing spending. High mortgage rates have already caused a downturn in the national housing market, and high inflation is eating into household budgets. While labor markets remain tight for now, U.S. growth is expected to manage just 0.3&#37; next year.<\/li>\n<li>COVID-19 has receded as a critical economic risk. The U.S. population has largely returned to business as usual. Barring an unexpectedly virulent resurgence, the biggest remaining concerns are the labor force impacts of long COVID and ongoing shutdowns in China.<\/li>\n<li><span aria-label=\"Hawaii\">Hawai&#699;i<\/span>\u2019s visitor industry continues to make recovery progress. The international visitor market has made significant strides, adding to strong domestic travel. Japanese visitors are finally returning to the islands, even as a weak yen and high costs weigh on their vacation spending. The timing of <span aria-label=\"Hawaii\">Hawai&#699;i<\/span>\u2019s international tourism recovery will provide a much-needed lift as growth in other sectors slows in 2023.<\/li>\n<li>Although the <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> labor market is tight, with unemployment just over 4&#37;, the number of payroll jobs remains below pre-pandemic levels. The ongoing visitor industry recovery will support job gains in tourism-related areas next year, while many other sectors experience weakness. Aggregate job growth will slow from more than 5&#37; this year to 1.7&#37; in 2023.<\/li>\n<li>Inflation in <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> is running lower than on the continental U.S., but it is nevertheless inflicting pain on <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> households and businesses. Nominal wage gains are not keeping up with rising prices. Together with the ending of pandemic-era federal support programs, this is dragging down real (inflation-adjusted) income. Total real income from all sources will drop more than 5&#37; for this year as a whole and manage just over 1&#37; growth in 2023, before firming.<\/li>\n<li>Cost pressures will continue to challenge the construction sector in 2023. But despite a small pullback in employment this year, the industry will sustain a high level of activity, with key support from several very large public-sector projects that are currently in the engineering and design phase.<\/li>\n<\/ul>\n<p><abbr>糖心视频ERO<\/abbr> forecasts that while <span aria-label=\"Hawaii\">Hawai&#699;i<\/span> will likely escape an outright contraction in economic activity, it will still be adversely affected by softer global conditions, further interest rate hikes and temporarily high inflation. Significant downside risks exist, given the perilous path facing the U.S. and global economies.<\/p>\n<p><abbr>糖心视频ERO<\/abbr> is housed in <abbr title=\"University of Hawaii\">糖心视频<\/abbr> M\u0101noa\u2019s <a href=\"https:\/\/socialsciences.manoa.hawaii.edu\/\">College of Social Sciences<\/a>.<\/p>\n<p><a href=\"https:\/\/uhero.hawaii.edu\/uhero-forecast-for-the-state-of-hawaii-us-recession-will-weigh-on-hawaiis-recovery\/\">Read more on <abbr>糖心视频ERO<\/abbr>\u2019s website<\/a>.<\/p>\n<div class=\"responsive-video-wrap-post\"><figure class=\"wp-block-embed wp-block-embed-youtube is-type-video is-provider-youtube epyt-figure\"><div class=\"wp-block-embed__wrapper\"><div class=\"epyt-video-wrapper\"><iframe  id=\"_ytid_33262\"  width=\"676\" height=\"380\"  data-origwidth=\"676\" data-origheight=\"380\" src=\"https:\/\/www.youtube.com\/embed\/_KH49jQIqZw?enablejsapi=1&origin=https:\/\/www.hawaii.edu&rel=0&autoplay=0&cc_load_policy=0&cc_lang_pref=&iv_load_policy=1&loop=0&fs=1&playsinline=0&autohide=2&theme=dark&color=red&controls=1&disablekb=0&\" class=\"__youtube_prefs__  no-lazyload\" title=\"糖心视频ERO Focus: 2022 Q3 Forecast\"  allow=\"fullscreen; accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen data-no-lazy=\"1\" data-skipgform_ajax_framebjll=\"\"><\/iframe><\/div><\/div><\/figure><\/div>\n<p>The newest episode of <abbr>糖心视频ERO<\/abbr> Focus is on the third quarter forecast.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><abbr>糖心视频ERO<\/abbr> has released its third quarter forecast for 2022.<\/p>\n","protected":false},"author":16,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[301,1411,197,1363,1026,74,9,343],"class_list":["post-165762","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-research","tag-college-of-social-sciences","tag-covid-19","tag-economics","tag-manoa-research","tag-social-science","tag-tourism","tag-uh-manoa","tag-uhero","entry","has-media"],"aioseo_notices":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/165762","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/comments?post=165762"}],"version-history":[{"count":6,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/165762\/revisions"}],"predecessor-version":[{"id":165790,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/165762\/revisions\/165790"}],"wp:attachment":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/media?parent=165762"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/categories?post=165762"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/tags?post=165762"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}