Tour spotlights role of Hawaii manufacturers

Tourism may be the state’s No. 1 industry, but manufacturing plays a key role in the economy as well.

The Chamber of Commerce Hawaii, in partnership with neighbor island chambers and INNOVATE Hawaii, recently hosted a bus tour of manufacturers across the isles to show that manufacturing growth can put Hawaii’s economy on the path to greater success.

The statewide bus tour, which took place Monday through Friday on Oahu, Kauai, the Big Island and Maui, provided insight into how Hawaii manufacturers operate and highlighted the importance of manufacturing to the community and local economy. Coastal Windows was a stop on the Oahu bus tour, along with Choco le’a, Maui Divers, The Cut Collective and the College of Engineering at the University of Hawaii at Manoa.

Gov. David Ige kicked off the week by issuing a proclamation designating Oct. 2 as Manufacturing Day in Hawaii, recognizing the importance of manufacturing to the state as well as the Chamber of Commerce Hawaii and INNOVATE Hawaii’s work in advancing the industry. Other activities during National Manufacturing Week in Hawaii included ASSEMBLE 2015, a manufacturer suppliers show and exposition, on Tuesday; and a Small BIZ Academy on Wednesday with complimentary workshops.

The bus tour and other events also gave local manufacturers a chance to learn more about the chambers’ Manufacturing in Hawaii Initiative, which last year successfully lobbied for a $2 million grant to fund manufacturers. The High Technology Development Corp., whose main goal is to develop and grow Hawaii’s commercial high-technology industry, will be administering the grant. Funds can be used for equipment, training, energy efficiency and planning of a new facility, HTDC Executive Director Robbie Melton said.

“The bus tours are an important way to raise awareness of this industry,” said Sherry Menor-McNamara, Chamber of Commerce Hawaii president and CEO. “This event, as well as the grant and other initiatives, are steps in the right direction and show legislative and government support for this important industry in Hawaii. The manufacturing industry is a vital component of Hawaii’s economy and continues to flourish, supporting nearly 13,500 jobs in Hawaii, with small businesses representing approximately 85.50 percent of all exporters in Hawaii.”

According to the U.S. Bureau of Economic Analysis and the U.S. Census Bureau, the manufacturing industry within Hawaii represents 71 percent of the state’s export share, providing jobs with an average annual compensation of more than $42,800 per year, or 15 percent more than other private nonfarm jobs.

These sources reported that manufactured goods exports from Hawaii from 2009 to 2014 increased by 172.14 percent. In 2013 the total output from Hawaii’s manufacturing sector was $1.35 billion, accounting for nearly 2 percent of the state’s total output. Another $870 million in manufactured exports was realized through free-trade agreement partners with the top five markets, including Australia, China, Japan, Singapore and Panama.

“With the growth of manufactured goods exports from Hawaii more than doubling in five years’ time, from 2009-2014, we remain committed to continuing to help grow this sector, which, in turn, will positively benefit our economy and all of Hawaii’s residents,” said Wayne Inouye, director of INNOVATE Hawaii, which helps small and medium-size Hawaii companies create, build and grow more business.

Coastal Windows President Bob Barrett dubbed the event a success and said more collaborative opportunities are needed to bring government officials and local manufacturers together.

“Manufacturing in Hawaii, in my mind, has never been given the spotlight, which is on tourism and other larger economic drivers,” Barrett said. “Tourism has the Hawaii Tourism Authority and other assistance, but we are on our own. I was very pleased to hear about the manufacturing grant. To me it’s new, and it’s the only monetary support that I’ve seen for manufacturing since 1990 when we opened Coastal Windows.”

In its 25 years in Hawaii, Coastal Windows has grown from seven employees in a 5,000-square-foot space to a team of about 50 employees in a 50,000-square-foot manufacturing facility. With a little more support, Barrett said he could put even more people to work.

“The grant could potentially help Hawaii’s manufacturers offset rising prices or equipment costs,” Barrett said. “I’d also like to see lawmakers work with manufacturers to come up with request for proposals that don’t exclude local manufacturers. They should also consider passing consumer tax rebates or business incentives that encourage individuals and businesses to buy local. With the trickle-down impact, that snowball would get big quickly.”

That’s partially because many local manufacturers like Choco le’a, a gourmet chocolate company in Manoa, support local businesses themselves, said Erin Kanno Uehara, who launched the company with other family members, including her uncle Colins Kawai, in 2010.

“We use Hawaiian chocolate and macadamia nuts, and we use packaging from (local commercial printer) Edward Enterprises,” Uehara said.