$100M gain in tourism uncovered

A sudden turnaround was announced Friday in Hawaii’s tourism industry, which had been fading a bit from last year’s visitor arrival and spending records but now is on course to reach new highs.

It’s as if more than $100 million in visitor spending earlier this year had gone uncounted.

Well, that literally did happen, according to the Hawaii Tourism Authority.

HTA officials announced that they reconstructed several months of visitor spending estimates after receiving information in early June that a contractor on Maui was not producing legitimate survey data from departing visitors.

The result from recasting the figures basically erased what had been a declining trend and helped boost visitor spending this year through May by 3 percent, or $174 million, to $6.1 billion. In May alone spending rose 5 percent, or by $52 million.

"Visitor spending appears to be trending up for 2014," Mike McCartney, HTA president and CEO, said in a statement.

Before the adjustments, reported visitor spending had fallen for eight straight months — from September to April compared with the same months the year before — including a $144 million, or 3 percent, decline this year through April.

Daniel Nahoopii, HTA director of tourism research, said revised data for Maui spending was generated with the help of Maui tourism businesses and research firms, and that the agency is confident that the figures in the May visitor spending and arrival report are accurate.

The "revalidated data" indicate that total spending during the first four months of the year was revised upward by $100 million to $5 billion from $4.9 billion.

More data adjustments were made going back even further — to June 2013, HTA said.

Nahoopii said it is not yet exactly known what was going on with the Maui surveys in question, though one employee of a contractor is suspected to be the cause of the issue.

A complaint and notice from the contractor uncovered red flags about the data, which Nahoopii said might have been copied from prior surveys. An investigation is ongoing. McCartney said HTA, the contractor and the state Attorney General’s Office are reviewing the matter.

Looking ahead, McCartney said he expects "a strong summer season" for tourism supported by increased air seat inventory through September.

The number of visitors to Hawaii this year through May is down by 0.5 percent, or 16,392 tourists out of nearly 3.4 million. In May there was a 1.8 percent gain to 649,125 visitors from 637,514 in the same month last year.

That represents a rebound from three straight months of declines. However, some data adjustment was also at play that benefited arrivals.

Nahoopii said a normal data refining process that includes using information from airlines to adjust preliminary arrival counts from the prior year had the effect of lowering the 2013 arrival count by about 1 percent. That improved this year’s preliminary figures in the year-over-year comparison.

In May there was some weakness in arrivals from the U.S. West, the state’s No. 1 market, which slipped 0.6 percent. However, that was nearly offset by gains in other regions: 1.1 percent for the U.S. East, 3.9 percent for Japan, 10.3 percent from Canada and 2 percent from all other markets.

The cruise industry delivered 7,034 visitors in May, a 72 percent gain over 4,088 passengers a year earlier.

Given the adjustments and new outlook, 2014 could become a third consecutive year for record arrivals and spending.

The peak last year was 8.17 million arrivals and $14.5 billion in spending. The year before that, arrivals set a record at 8.03 million, and spending was $14.25 billion.