For Immediate Release: June 6, 2006
DBEDT Release News 06-16

HONOLULU--The Department of Business, Economic Development and Tourism (DBEDT) has released The 2002 State Input-Output (I-O) Study for Hawaii, a report which measures how the state's industries interact to produce goods & services and generate jobs and income in Hawaii.

Prepared by DBEDT'S Research and Economic Analysis Division (READ), the report utilizes recently published data by the U.S. Census Bureau as of 2002. It updates The 1997 Hawaii State Input-Output Study.

The updated report as well as the detailed inter-industry data and various economic multipliers can be found on the DBEDT Web Site at: www.hawaii.gov/dbedt/info/economic/data_reports.

"The I-O model is a critical economic development tool that helps predict how changes in one industry's final demand, employment and income can affect rest of the economy," said State Economist Pearl Imada-Iboshi. "Information in the report can help policy makers focus both public and private development efforts on areas that will benefit the economy the most."

Using I-O multipliers, economists determine changes in total output, employment and income levels in the entire economy. The report also demonstrates the correct use of I-O multipliers in different situations.

Among the cautions made for the report are:

• There is no single "multiplier" for the entire economy. There are many multipliers that may apply to each industry and for each type of impact, such as output, income, or jobs. In many cases there may be no multiplier effect if the new economic activity is simply taking the existing demand away from another activity.
• High multipliers are not necessarily "good," nor are low multipliers necessarily "bad." Some activities may have high employment multipliers but low income multipliers and vice versa. Also, activities with high multipliers may have a high demand for infrastructure and other resources which would reduce the true benefit of the activity to the community. Thus, I-O multipliers must be used in conjunction with other desirable measures of economic activity.

"With the completion of this basic study, we can begin to develop a number of other tools that economic development agencies, planners and the business community can use - including long range forecasting models," Imada-Iboshi said.

The new report is focused on the state level. The county-based Input-Output study is expected to be completed in the fall of 2006.

For more information, contact:
Dave Young
Communications
Phone: (808) 587-1212
Email: dyoung@dbedt.hawaii.gov