It’s Important to Work on Making Hawaii More Affordable and Livable, But Outmigration Is Likely to Continue

When Ben Cayetano ran for Governor in the state of Hawaii – his first try and reelection – even way back then the issue of giving Hawaii locals incentives to stay on the islands and remain with family was a campaign talking point. Cayetano, on the other hand, would remark that only in Hawaii is moving out of state a big concern.

Cayetano was mostly right as others on the mainland will move without painstaking apprehension. But the reason Hawaii locals take issue with “leaving out of necessity” is that Hawaii is not like many other states – it’s “paradise;” and there is a strong cultural bond for the ohana to stay together. In this election year as it was two years ago, there is still political pressure placed on lawmakers to make the islands more affordable so that locals can remain in the state.

Since the 1990s and early 2000s when Cayetano was governor up until today, the high cost of living in Hawaii and lack of affordable housing haven’t changed much– both annually coming in the top three in the nation. Hawaii’s high tax burden and price of goods also rank among the highest in the nation.

It’s been over three decades of lawmakers making promises to improve the conditions with little progress because in many ways Hawaii as a desirable location keeps driving up housing and living costs. The fact that Hawaii is an islands-chain, isolated, and must have most goods shipped over also contributes to the staying power of high food prices.

While Gov. Josh Green is taking aggressive and innovative measures to expand the state’s housing inventory – arguably more than any previous administration – the realistic outcome most likely will be marginal with increased numbers of locals having opportunities to buy an affordable property but a majority of young adults (who do not have property to inherit) will move to the mainland just to be able to afford a place to live without having to work two-plus jobs.

The cumulative years of Hawaii’s net outmigration – now seven years consecutively – could suggest that the affordability situation has worsened. Besides some local residents’ complaints of being outpriced in Hawaii, economists and researchers say the outmigration is taking a toll on the economy in the way of a shrinking tax base, consumer base, workforce. There is also evidence of a “brain drain” as Hawaii’s most educated are opting to leave for mainland universities and stay there.

Focus on improving Hawaii’s job market
While it’s still important for lawmakers to work on affordable housing and easing the cost of living, the reality is these are mostly market driven and fixed to the extent that Hawaii will always rank high nationally in these areas.

Where lawmakers should put increased efforts into and working with the private sector is to attract higher paying and quality jobs that will enable locals to afford to live here. Researchers point to the double whammy effect burdening residents: having to live in a state that has one of the highest costs of living but also a median pay that does not match other states with similarly high living expenses.  In other words, Hawaii has big city costs, but small state salaries.

The commonsense aim then is to boost the second part that can only be accomplished by attracting industries like high tech-information industry.  The tech industry is a $4.6 trillion industry, up from $4.4 trillion in 2022. Software development, cybersecurity and the progression of cloud computing and AI advancements are all lucrative areas to count on well into the future.

New York is the center of finance with Wall Street and northern California has Silicon Valley. Hawaii can capitalize on its strength of natural resources and develop alternative energy that could be a boon in producing high-paying careers and jobs.

Virtual work is another area for young adults to tap, get high salaries and enable them to make a good living in Hawaii. The problem is helping locals learn where these remote jobs are and providing a network base showing the world that workers here have the skills and smarts to do these jobs from data scientists and AI engineers to hedge fund managers and private equity associates. There are endless possibilities that have opened with virtual work.

Leaving Hawaii can be beneficial
There are many locals who’ve left Hawaii and say it was all worth it for reasons besides affordability. Just as many of our immigrant parents and grandparents who left their home countries in Asia primarily at first for economic opportunities then later discovered Hawaii offered so much more than better financial outcomes, Hawaii transplants to the mainland are saying the same.

New experiences, personal growth, cheaper means to travel state-to-state are just some of the reasons why former Hawaii residents choose to stay in the mainland. For the same reason that Hawaii is attracting mainlanders as new residents who come for new experiences here that their home states cannot offer, we see Hawaii locals likewise leaving.

Some local residents will choose to leave Hawaii no matter if it is affordable or not.  Curiosity and a yearning for an eventful journey in life will compel locals to leave not just to the mainland, but with the global economy and the rise of new robust markets in Asia and the Philippines included, more Hawaii people could, in fact, find themselves returning to their ancestral countries.

Ultimately, the goal should be to provide our local residents options to stay, leave or to return in retirement when that journey is over.

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