The Department of Business, Economic Development and Tourism (DBEDT) released its third-quarter 2025 Statistical and Economic Report, offering a detailed look at Hawaii's economic trajectory. The report forecasts the state's economy to grow by 1.3% in 2025, a slight increase from previous estimates. This positive adjustment suggests a degree of resilience in the face of ongoing economic challenges. However, the report indicates that a full recovery is anticipated to be complete by 2027.
This forecast comes after previous revisions. DBEDT had previously lowered its economic growth projections for 2025 to 1.2 percent. The adjustment reflects the impact of various factors, including international trade dynamics and concerns about inflation. Despite these challenges, the state's economic outlook remains cautiously optimistic, especially with stronger growth expected in subsequent years. DBEDT has cited tourism-related sectors as key to economic recovery.
The recovery is partially dependent on the tourism sector, which has faced its own set of hurdles. AOL previously reported a slowdown in the tourism sector. According to the latest economic forecast from DBEDT, visitor arrivals to Hawaii are not expected to fully recover until 2027. DBEDT projects that visitor arrivals will rise 1% in 2025 and around 2% each year between 2026 and 2028. This makes the outlook for businesses reliant on tourism cautiously optimistic. The state's labor market is expected to remain stable, with only modest impacts on the unemployment rate, according to DBEDT.
For Hawaii's entrepreneurs and investors, the report provides crucial insights for strategic planning. The projected growth, though gradual initially, could create opportunities in several sectors. The anticipation of a stronger recovery by 2027 suggests that long-term investments and strategic planning are essential. Those involved in the hospitality industry should pay close attention to the projected rise in visitor arrivals. Local businesses, especially those dependent on tourism, should refine their strategies. While the DBEDT projects steady growth in the upcoming years, the potential ramifications of external factors must be considered by investors.
