2 days ago
Hawaiʻi ranks 3rd worst economy: 3 takeaways from new report
HONOLULU (KHON2) — In 2025, Hawaiʻi's economy ranked 49th out of all U.S. states, according to a new annual analysis.
This low ranking highlights several challenges our state faces in economic activity, innovation and high-tech industry presence.
Here's what we know from the report:
The report evaluated states across 28 indicators. These included gross domestic product (GDP) growth, export activity, startup formation and employment in high-tech sectors. Hawaiʻi's performance in these areas was as follows:
Overall Rank: 49th.
Economic Activity: 47th.
Economic Health: 31st.
Innovation Potential: 49th.
Government surplus: 3rd.
Average educational attainment of recent immigrants: 5th.
Notably, Hawaiʻi ranked 51st in exports per capita and 50th in the percentage of jobs in high-tech industries.
These figures indicate a limited presence in global trade and a relatively small high-tech sector compared to other factors have been identified that contribute to Hawaiʻi's economic challenges:
High cost of living: The state has the third-highest cost of living in the nation. This impacts both residents and businesses. Utility costs are particularly high, and taxes on both individuals and corporations are above average.
Limited export activity: Hawaiʻi's exports per capita are the lowest in the country. It reflects a lack of diversification in trade and reliance on a narrow range of industries.
High-tech industry presence: The state's low ranking in high-tech employment suggests challenges in attracting and retaining technology-driven businesses and talent.
Despite these challenges, Hawaiʻi's economy is projected to grow by 1.7% in 2025. This growth is expected to be driven by sectors such as construction, real estate, and tourism, according to Hawaiʻi DBEDT.
However, the state's growth rate remains below the national average which indicates that Hawaiʻi's economic recovery may be slower compared to other states.
You can click to read the full report.
Hawaiʻi's 49th-place ranking in the 2025 economic performance study underscores significant challenges in economic activity, innovation and high-tech industry presence.
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Addressing these issues will require targeted efforts to diversify the economy, reduce living costs and foster growth in high-tech sectors.
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