Local 3: Oahu and Hawaii economics (v1.0)

Many people wonder what the economy of Oahu (and to a lesser extent Hawaii) looks like. It is interesting. 

Although there is some light manufacturing, the people do not favor heavy manufacturing since a love for the land and the ocean and the air is deeply felt. One of the big reasons we moved here (among many) is because the air quality is great. San Jose where we lived? Not so good. 

The population of Honolulu/Kaneohe/Pearl City metro (which is largely Honolulu County that encompasses all of Oahu) is roughly a million (the vast bulk of the state's population live here). The GDP is around $75 billion.  That works out to a GDP per capita of $75K from what I see. That puts it around 20th among major US metros from what I see. The San Jose/Sunnyvale/Santa Clara is around $210K (#1). The San Francisco/Oakland/Berkley is around $144K. The Seattle/Tacoma/Bellevue is about $119K. The Boston/Cambridge/Newton is about $108K. The New York/Newark/Jersey City is about $100K. The Washington/Arlington/Alexandria is about $95K. Los Angeles/Long Beach/Anaheim is about $86K. Chicago/Naperville/Elgin is about $80K. 

The major industries on Oahu are Social and Health Services, Real estate and Accommodation and Food services, Government (Federal/State/Military), and Retail.  There are also some banks like Bank of Hawaii headquartered here and there are some financial services. Honolulu's location in the mid-Pacific makes it a major stopover for trans-Pacific Sea and air shipments. Honolulu Harbor has a highly successful Foreign Trade Zone, and 10 major shipping companies serve the port. The harbor also has terminals for commercial fishing, cruise ships, and ferries.

There is some limited agriculture, but that industry is far more pronounced on other islands. The plant based agricultural products Hawaii as a whole is mainly known for are Papayas, Avocados, Macadamias, Coffee, Sugarcanes, Bananas, Floriculture, and Pineapples and some of it (especially greenhouse plants) are grown on Oahu. Oahu also has significant Poultry, Dairy and Egg farms.   

The unemployment rate is about 2.6%. The median household income is about $93K. San Jose/Sunnyvale/Santa Clara is about $145K. San Francisco/Oakland/Berkley is about $128K. Washington/Arlington/Alexandria is about $117K. Seattle/Tacoma/Bellevue is $110K. Boston/Cambridge/Newton is about $104K. New York/Newark/Jersey City is $91K. Los Angeles/Long Beach/Anaheim is $89K. Chicago/Naperville/Elgin is $85K. The median home price is about $860K (San Jose Metro area is more like $1.3 million). 

Most of the products in shops and grocery/supermarkets have to come from the US mainland or other countries, So the cost of basics is higher. Approximately 85% of everything used in Hawaii is imported and 91% of that passes through the harbor system. Most of the electricity is from oil, and oil is imported so both electricity and gas are pricy. The proportion of electricity from renewables is however increasing quickly. Construction costs are high. Oslo, Norway, topped global construction cost relativity index in a report, and was followed by San Francisco, New York, Honolulu, then Paris. 

I used a cost-of-living comparison software calculator to compare Honolulu and San Jose (where I lived before) and it is roughly the same. However, it is clear California, Hawaii, Washington DC, New York, and Massachusetts are among the most expensive states/territories to live in.   

Is Hawaii or Oahu a magnet for the ultra-wealthy? No. Not really. There are two billionaires in Hawaii. Pierre Omidyar of Honolulu (Net worth: $8.8 billion) and Larry Ellison of Lanai (Net worth: $112.3 billion). Compare this to 68 billionaires in San Francisco Bay area, and 60 billionaires in New York area. Other areas with high numbers of ultra wealthy are around LA area (34 billionaires), Miami area (12 billionaires) and Austin area (9 billionaires).  The U.S. as a whole is home to, at last count, 735 billionaires (with 2.6K billionaires in the world), the most of any country, who have a combined net worth of $4.5 trillion dollars. Half of them live in just four states (California, New York, Florida and Texas) and there are 7 states with none (Alabama, Alaska, Delaware, New Hampshire, New Mexico, North Dakota, and Vermont).

The UHNWI (Ultra High Net Worth Individuals - net worth over $30 million) population in the world is 513K. The share in US itself is 240K. I could not find the number of UHNWI in Hawaii. The world has 21.7 million HNWI's (High Net Worth Individuals - net worth over $1 million). North America itself has 7.35 million HNWI's. Hawaii has 44K millionaire households (9.2% of households). I did not research VHNWI (Very High Net Worth Individuals - net worth over $5 million) but America is estimated to have 1.6 million households in the top 1% (over 5.8 million dollars in net worth). This is out of about 130 million households, so it is a small fraction. This top 1% have a fortune of $44 trillion dollars!! I could not find the number of households in Hawaii in this top 1%. 

In summary, the available information suggests Hawaii has a relatively high concentration of wealthy millionaires that boosts the economy, but less so for billionaires and possibly UHNWI.