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Mission Military

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Mission Military: What you Need to Know About Hawaii's 2nd Largest Industry  

The military in Hawaii represents the state’s second largest industry, after tourism. Pacific Business News Editor in Chief A. Kam Napier has more on what we can expect in terms of its size and spending.

Tourism accounts for 18% of the state’s G.D.P.  The Military, 8%.  The Pearl Harbor shipyard is the state’s largest industrial employer.  Consequently, economists and policymakers here keep an eye out for changes in the number of active duty personnel stationed here as well as federal spending levels.

As reporter Kathleen Gallagher found, there is some anxiety over potential cut backs, especially due to ongoing sequestration.  Sequestration requires cuts to federal spending, including all four branches of the military, through 2021.  Hawai‘i could see a reduction in forces.  According to Carl Bonham with the University of Hawai‘i Economic Research Organization, we could even see a round of base closures that could affect Hawai‘i.  Kama‘?ina will recall that this last happened in 1999 when the U.S. Navy closed Barber’s Point Naval Air Station to save on its annual operating cost of $12 million.

Currently, cutbacks seem hypothetical but that doesn’t mean people aren’t planning for them.  The State of Hawai‘i has requested funds from the Department of Defense to study the economic impact of the military in Hawai‘i – and the D.O.D. itself has commissioned its own study. 

At the moment there are no cuts.  As the U.S. defense policy has made a pivot towards the pacific in recent years, the number of active duty personnel in the state has climbed.  Nearly 47,000 personal are assigned here, almost exactly as many as in 1985, during the height of the cold war.

Defense contracts issued in Hawai‘i have for the last eight years, held steady at just over $2 billion dollars per year… and currently the U.S. Senate is considering $200 million in spending to upgrade installations in the islands. 

A. Kam Napier is the editor-in-chief of Pacific Business News.
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