HONOLULU — U.S. military spending continues to be a pillar of Hawaii’s economy as the Department of Defense has so far proved resistant to the financial impact of the coronavirus.
The financial damaged suffered by the state because of the significant decrease in tourism has been offset by uninterrupted employment at Pearl Harbor Naval Shipyard and continued military contracts, The Honolulu Star-Advertiser reported Sunday.
The outbreak of COVID-19 has resulted in a state jobless rate of 22%, while the shipyard continues to employ 5,800 civilian workers, making it the state’s largest industrial employer that adds about $1 billion to Hawaii’s economy.
The University of Hawaii was recently awarded a four-year contract valued at up to $75 million to continue operating the Air Force’s Maui High Performance Computing Center.
Hensel Phelps Construction in Honolulu was awarded a $54 million contract in April for the design and construction of a Navy SEALS training facility at Pearl City Peninsula.
Hawaii also has about 42,000 active duty military personnel, nearly 10,000 Guard and Reserve members, 20,000 civilian defense workers, 60,000 dependents, 18,000 retirees, and 111,000 veterans.
Hawaii had 5,300 non-defense federal employees as of late 2017, the U.S. Office of Personnel Management said.
Hawaii has received more than $7 billion in federal assistance for COVID-19 response.
Prior to the health emergency, Hawaii received the nation’s second-highest infusion of defense spending as a percentage of state gross domestic product at 7.7% for fiscal year 2018, the Office of Economic Adjustment said. Virginia was higher at 10.3%.
“Federal spending, more than just military, is a stabilizing force now,” said Carl Bonham, executive director of the Economic Research Organization at the University of Hawaii.
