State tallies modest rise

Personal income rose modestly in Hawaii in the second quarter, but the increase was among the smallest in the nation, according to a new report.

Personal income — which includes wages, interest, dividends, rent and government payments — climbed 0.8 percent in the state during the April-to-June period compared with the previous three months, the U.S. Bureau of Economic Analysis reported. Only Indiana, Oregon, the District of Columbia and Nevada had smaller increases. The national average increase was 1 percent.

Hawaii fared better in the first quarter when personal income rose by a revised 1.1 percent.

Although the islands ranked poorly in overall personal income growth among states, there are some signs of improvement.

Wages and salaries rose by 0.6 percent in the second quarter. The state unemployment rate fell to 6.3 percent in July from a peak of 7 percent last summer, while the number of nonfarm payroll jobs has risen by 6,100 during the same period.

Recruiters are noticing gains in wages and employment in some industries.

"We have definitely seen an improvement as far as the numbers go," said Heather McGinnis, a recruiting manager in the Honolulu office of Robert Half Finance and Accounting, which places employees in positions ranging from bookkeepers to chief financial officers. "The trend has been a lot more hires the last few months."

In addition to an increase in temporary hires, many of the temporary positions have "flipped over" into permanent jobs, she said.

"There is definitely more of a need on the part of employers, so they’re looking for talent," McGinnis said.

The area where Hawaii residents saw the biggest increase in personal income was in transfer receipts, a category of government payments that includes things like stimulus money, unemployment compensation and veterans benefits. Transfer receipts rose by 1.8 percent here compared with a 2 percent increase nationally. Unemployment benefits fell in 36 states, including Hawaii, the bureau said.

The state Department of Business, Economic Development and Tourism is forecasting personal income for all of 2010 to rise by 2.5 percent. However, most of that increase will be lost to inflation, which the department estimates will be 2.2 percent this year. That would result in an inflation-adjusted increase of just 0.3 percent in personal income.

In other major categories, income from dividends, interest and rent rose by 0.5 percent.

For all of 2009 Hawaii’s personal income per person fell to $42,009 last year, down $68, or 0.2 percent, from 2008. It was the 11th-highest income in the nation.