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8 Ways to Fire Up Hawaii's Economy

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2) Capital projects

There is general agreement that capital projects stimulate the economy, but how quickly does that happen?

Lance Wilhelm, senior vice president for Hawaii’s Kiewit Building Group, says that simply signing a contract for a big government construction job can send a bolt of energy through the local economy.

The minute that contract is awarded, says Wilhelm, the contractor begins assembling supplies, subcontractors and a core team of workers. Not one government dollar may have been spent yet, but that’s almost beside the point.

“Subcontractors will need to purchase raw materials such as concrete and lumber, so contracts for those services and supplies begin to be written immediately,” says Wilhelm. “So while no cash has yet changed hands, businesses begin to make investments in themselves and other purchases. … And all those things build a certain amount of expectation which is all very positive.”

The bidding process for state jobs generally takes about a month, though it can be as long as two months, says Wilhelm, whose firm recently bid on several projects worth $10 to $30 million each. Once a contract is awarded, it may be another two months before money starts flowing.


“If a project were to be awarded today, our first job paychecks would start going out within an eight-week timeframe,” he says. “Certain projects, such as those at the airport, take a little longer, because there are security issues.”

Once a project begins, the economic “trickle down” is immense. “In any kind of commercial building project you could have 100 different businesses impacted,” says Wilhelm. That includes workers such as carpenters, masons and painters; engineers, architects and their teams; and suppliers of concrete, lumber, structural steel and many other things.

Back in November and December, even before the full force of the recession hit, Gov. Linda Lingle’s administration was already “speeding up” action on $1.8 billion in state-funded capital improvement projects on the books, according to Lt. Gov. James R. “Duke” Aiona.

“As of mid-March, we have already put 411 projects worth $856 million in the cycle – whether by way of having a contract, actual construction or putting it out to bid,” Aiona said.

“The Department of Business, Economic Development and Tourism has a formula which says that for every million dollars we invest, we create about 13 jobs.”

Another $246 million in federal stimulus money allotted to Hawaii has already been pegged to fund 22 highway and airport improvement projects, and an unspecified number of bus transit projects throughout the state. It’s expected to take 30 to 40 days to finalize guidelines for that money, which would put start dates for those projects around mid-May.

“So much in these economic times is psychological,” Wilhelm says. “If you’re feeling optimistic about the future and you have projects to keep you busy, then you can make investments in your business.” –BC

3) Volunteer at a nonprofit

When the economy is down and cash is tight, volunteering is one way to immediately help the economy and the community.

Consider this: If the American Red Cross closed, the need for disaster relief would still exist in Hawaii. “If it wasn’t for nonprofits, people in need would have nowhere else to turn but to the government,” says Coralie Chun Matayoshi, CEO of the Red Cross-Hawaii State Chapter. “And taxpayers would need to help those who originally were helped by nonprofit organizations.”

Donations fall during a recession, yet nonprofits are expected to provide the same services or more, so volunteers are crucial. Fortunately, Chun Matayoshi says, the Red Cross has enjoyed a 10 percent increase in volunteers over last year, mainly because people who have lost their jobs have more time to give. –SE


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