Brewbaker: No recovery until 2011...varies from UHERO and DBEDT

Excellent article by Janis Magin. This is as optimistic as it gets:

From: http://pacific.bizjournals.com/pacific/stories/2009/10/26/daily51.html

Thursday, October 29, 2009
"Brewbaker: No recovery until 2011" by Janis L. Magin
Pacific Business News (Honolulu)

Economist Paul Brewbaker has joined other experts in forecasting that the state won’t see meaningful recovery from the recession for more than a year.

But Brewbaker, a consultant for the Bank of Hawaii, believes there will be higher unemployment and a greater decline in personal income than cited in other economic forecasts.

“Slow recovery seems likely to leave unemployment rates unchanged until 2011,” Brewbaker, the bank’s senior economic adviser, wrote in the forecast posted on the bank's Web site this week. “A jobless recovery like the one in 2002-03 is a likely scenario at least in 2010.”

Brewbaker forecasts that the state’s jobless rate will end in 2009 at 7.9 percent and rise to 8.4 percent next year.

Brewbaker, a former bank economist who now has his own firm, TZ Economics, noted that the job losses during this downturn were larger and happened at a faster pace than previous downturns.

“Job loss during Hawaii’s ‘lost decade,’ the 1990s, pales by comparison to 2008-09 and took many more years to unfold,” he wrote. “This time, 30,000 private jobs in Hawaii have been eliminated in 18 months — a speed and size record.”

Brewbaker expects the number of Hawaii jobs to fall 2.9 percent this year, and another 1.3 percent next year. The figure for 2009 was in line with forecasts by the University of Hawaii Economic Research Organization and the state Department of Business, Economic Development and Tourism, which both forecast a 3 percent decline in jobs.

However, Brewbaker’s prediction for 2010 was about a half a percent higher than the other two.

He also expects personal income to decline by 2.5 percent this year, more than twice the 1.1 percent decline predicted by UHERO and six times the 0.4 decline in the DBEDT forecast.

Brewbaker’s forecast for visitor arrivals is slightly more optimistic. He expects the total number of visitors arriving by air to decline 3.1 percent this year before rebounding with a 3.7 increase in 2010, the bulk of those from the U.S. Mainland.