Experts discuss a 5 point plan to help Hawaii’s economy recover
Experts on Hawaii’s economy discussed their ideas for a five point plan to help Hawaii’s economy recover and how the vaccine rollout is vital in helping reopen the economy. Ray Vara, president and CEO of Hawaii Pacific Health, Peter Ho, chairman and CEO of Bank of Hawaii and Dr. Mark Mugiishi, president and CEO of the Hawaii Medical Service Association (HMSA), discussed these topics at a panel on the economy at the Hawaii State of Reform Virtual Health Policy conference Thursday.
Although Hawaii has done a pretty good job managing the spread of the COVID-19 virus, the economy has still suffered, said Vara. Hawaii’s economy is largely reliant on tourism, especially the service industry, which is one of the hardest hit industries nationwide.
“Some of the federal relief from CARES funding helps stem the tide a little bit,” said Mugiishi. “But there is no question that smaller businesses struggled probably the most of anyone. Large businesses maybe had a little bit more of the sustainability reserves to last a little longer.”
Experts worked together to create a five point plan of what they had to keep in mind in order for the economy to recover and improve from where it was pre-pandemic.
The first point in the plan was that public health and economic health are intertwined. Ray Vara said that it is “virtually impossible” to reopen the economy without a strong public health system. Making sure the vaccine rollout is efficient and is able to vaccinate people in a timely manner. He pointed to how Maui started vaccinating people 75 and older earlier than other islands did, this was in part because Maui has a smaller population, so the operational lift was not as challenging.
“It [the vaccine rollout] is going to be logistically challenging,” said Mugiishi. “It’s really, really important that people remember that as it rolls out, it won’t be perfect. There are going to be people who don’t belong who will end up getting the shot. There are going to be troubles with registration, problems with parking, there’s going to be times when you wait too long, all of these things are gonna happen. But the primary end point of this whole thing, is to get shots in arms.”
The second point was that the state and stakeholders need to consider financial capital. They need to make sure to make sure any short term steps will not hamper economic growth long term.
“The issue we have in front of us is a k-shaped economic environment and recovery,” said Ho. “And by that I mean that unemployment is obviously unacceptably high, but when we look at personal income numbers locally, they don’t look nearly as bad.”
Hawaii’s high cost of living makes it so business owners and residents are reliant on state and federal relief money and programs.
The third point raised by the experts was the need to consider the human capital in the recovery efforts. Hawaii needs to be able to invest in the people in their community, said Vara. By leveraging education, through workforce training or higher education, people are more likely to stay in Hawaii.
Physical capital was the fourth point raised by the panelists.
“We’ve got infrastructure, and we’ve got land and we’ve got a whole number of things in this state that we have a real opportunity to really look at and say ‘how do we make sure we’re making the highest and best use of those things and they’re effective’,” said Vara. “We know how important affordable housing is, we know some of the limitations we have around sewage and all the different things that our infrastructure needs. There’s been no greater time to strategically invest in those areas and be wise about the decisions we make.”
The fifth and final point raised by the panelists is the regulatory framework. Hawaii needs to be an inviting place for people to come and bring their businesses and also to entice people to stay in the state.
“We may very well lag [behind] the rest of the country coming out of the pandemic economically speaking,” said Ho. “People are going to face a choice of having to deal with whether or not they stay on the islands or leave. That choice is going to be driven in large part by what people see as available to them in terms of resources.”
The five points raised by the experts are not a whole plan, but rather a framework for the state government to consider when they are working on economic policies for the state.