4th Quarter 2009

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       Hawaii’s total personal income decreased during the second quarter of 2009 (the most recent data available from the U.S. Bureau of Economic Analysis - BEA) over the same quarter of 2008, mainly due to decreased Wage and Salary Disbursements and Dividends, Interest, and Rent.  The increase in Personal Current Transfer Receipts was not enough to offset the decreases in Earnings by Place of Work and Dividends, Interest, and Rent Receipts.  Increases in the government sector earnings were more than offset by losses in the private sector earnings.  Proprietors' Income also decreased in the second quarter of 2009 compared with the same quarter last year (Table B-1).
    
       On October 16, 2009 BEA released revised state quarterly personal income data (1069Q1 to 2009Q1) to incorporate the comprehensive revisions in the National Income and Product Accounts.  In the second quarter of 2009, total nominal personal income (i.e., not adjusted for inflation) decreased $230 million or 0.4 percent from the second quarter of 2008 (Tables B-1 and B-2).    This was the first negative quarter over same quarter since the series began in 1969Q1.  For the first half of 2009, total personal income decreased 0.1 percent or $44 million from the same period of 2008.
    
       In the second quarter of 2009, Wage and Salary Disbursements, the largest component of personal income, decreased $675 million or 2.3 percent from the second quarter of 2008.  For the first half of 2009, Wage and Salary Disbursements decreased $598 million or 2.0 percent from the same period of 2008 (Table B-3).  Wage and Salary Disbursements comprises about 54 percent of total personal income.
    
       Supplements to Wages and Salaries (employer payments to retirement plans, private group health insurance plans, private workers compensation plans, and other such benefits), however, increased $427 million or 5.1 percent in the second quarter of 2009 from the same quarter of 2008 (Table B-4).  For the first half of 2009, these supplements increased $394 million or 4.7 percent from the same period of 2008.
    
       Proprietors' Income, the income most closely related to entrepreneurial activity, decreased $227 million or 6.2 percent in the second quarter of 2009 over that of 2008 (Table B-5).  For the first half of 2009, Proprietors’ Income was down $214 million or 5.8 percent from the same period of 2008.

       Dividends, Interest, and Rent decreased $662 million or 6.7 percent in the second quarter of 2009 from the same quarter of 2008.  For the first half of 2009, Dividends, Interest, and Rent were down $490 million or 5.0 percent from the same period of 2008 (Table B-6).
    
       The only segment with large growth was Personal Current Transfer Receipts, which mainly include Government Social Benefits to Persons.  It grew by $899 million or 12.1 percent in the second quarter of 2009 from the same quarter of 2008.  For the first half of 2009, Personal Current Transfer Receipts increased $855 million or 11.9 percent compared to the same period last year (Table B-7).
   
       In the second quarter of 2009, Contributions to Government Social Insurance, which is subtracted from total personal income, decreased $5 million or 0.1 percent compared to the second quarter of 2008.  For the first half of 2009, Contributions to Government Social Insurance decreased 0.2 percent from the same period of 2008 (Table B-8). 
   
       In the second quarter of 2009, total non-farm private sector earnings decreased $455 million or 1.1 percent from the second quarter of 2008.  In dollar term, the largest decrease occurred in Construction, followed by Accommodation and Food Services, Transportation and Warehousing, Retail Trade, and Real Estate and Rental and Leasing. The largest increase occurred in Health Care and Social Assistance, followed by Utilities, Educational Services, and Professional and Technical Services.  During the second quarter of 2009, total government earnings increased $1,268 million or 9.3 percent from the second quarter of 2008 (Table B-1).
   
       In the second half of 2009, Honolulu’s consumer price index (CPI) increased 0.3 percent from the same period last year, compared to the U.S. average CPI decrease of 0.6 percent for the same period (Table B-9).  The slow Honolulu CPI increase in the second half of 2009 was primarily due to low Housing price increase (0.8 percent) and negative Transportation price increase (-11.0 percent). Prices increased the most in Apparel, followed by Other Goods and Services, and Food and Beverages, in the second half of 2009 compared to the second half of 2008.

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