Hawaii’s economy is expected to show stable growth this year and beyond as increased airlift from the mainland helps drive the state’s visitor industry.

The state said Friday in its quarterly forecast that a stronger U.S. economy and improving Hawaii labor market will provide the catalyst for growth.

"We are happy to see that our labor market has fully recovered from the 2009 recession, and in 2014 we had a historical high level of civilian labor force, civilian employment and payroll job count," said Luis P. Sala­ve­ria, director of the state Department of Business, Economic Development and Tourism. "Our unemployment rate was the sixth lowest in the nation."

Salaveria noted that 2014 was the third straight year of record visitor arrivals, with 8.28 million coming to the state.

"With the strong growth in the U.S. economy, we expect our visitor industry to continue to grow in 2015, especially in the U.S. markets," Sala­ve­ria said.

Hawaii’s inflation-adjusted gross domestic product, the broadest measure of economic output, should rise 3.1 percent this year, according to DBEDT, which revised the figure upward from 2.8 percent in its November forecast. DBEDT also lowered its forecast for Hono­­lulu inflation to 1.8 percent, down from 2.2 percent in its previous forecast.

Honolulu inflation — the state as a whole isn’t measured — was 1.4 percent in 2014, according to data released Thursday by the U.S. Bureau of Labor Statistics. It was the first time in 13 years that Hono­lulu inflation finished below the U.S. rate, which was 1.6 percent last year.

DBEDT’s report varied from a forecast released publicly Friday by the University of Hawaii Economic Research Organization, which called for a moderate expansion in the state this year. UHERO is forecasting inflation-adjusted GDP of 3.8 percent this year with inflation of only 0.7 percent.

"We revised our real (inflation adjusted) GDP growth for 2015 upward from the previous forecast because of the lower than expected inflation rate," said DBEDT chief economist Eugene Tian, who was expecting inflation of 1.5 percent last year. "When the inflation rate is low, purchasing power increases and the real growth increases."

He said UHERO’s GDP growth of 3.8 percent in 2015 is higher than DBEDT’s because of UHERO’s projected lower inflation.

"UHERO’s inflation rate for 2015 is 0.7 percent while ours is 1.8 percent," Tian said. "Though we believe oil prices will continue to drop, consumers spend only about 7 percent of their income on gasoline and electricity. We believe the impact on inflation from oil prices is not as large."

DBEDT said it expects visitor arrivals to grow 2.1 percent this year because total air seats to the islands are projected to increase 5.8 percent. Air seats are forecast to increase 7.4 percent from the mainland and 2.5 percent from international destinations. UHERO is forecasting visitor arrivals to increase just 1 percent this year.

"Though total visitor arrivals decreased (0.6 percent) in January, total visitor arrivals (are expected) to catch up in the coming months and end the year with a 2.1 percent increase in 2015," DBEDT said.

DBEDT said that nonagricultural jobs, which set a record in 2014, are expected to grow 1.2 percent this year to 634,500 positions.

"This growth rate is higher than the 20-year annual average growth rate of 0.8 percent," DBEDT said.

DBEDT’s full report, which contains more than 100 tables, is available online at dbedt.hawaii.gov/economic/qser.