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LĪHU‘E – Office of Economic Development (OED) invites the public to review the 2026 Kaua‘i Economic Outlook Summary prepared by the University of Hawai‘i Economic Research Organization (UHERO), providing valuable insights into the economic trends, opportunities, and challenges shaping Kaua‘i's future.
Prepared annually for the County of Kaua‘i with support from OED, the report offers data-driven analysis and forecasts to help inform decision-making by policymakers, businesses, nonprofit organizations, and community members.
According to UHERO, Kaua‘i's economy is expected to continue growing in 2026, though at a slower pace than in recent years as global and national economic challenges create new pressures on local households, businesses, and the visitor industry.
“While the forecast points to a slower pace of economic growth, Kaua‘i has consistently demonstrated its ability to adapt and move forward through challenging times,” said Nalani Brun, Director of the County of Kaua‘i Office of Economic Development. “The strength of our island lies in our people, our businesses, and our commitment to investing in the future. By continuing to support housing, infrastructure, workforce development, and economic diversification, we are building a stronger foundation for future generations while preserving the quality of life that makes Kaua‘i so special.”
UHERO notes that rising oil prices, increased travel costs, inflation, and a slowing U.S. economy are expected to weigh on economic activity throughout 2026. Despite these challenges, the report highlights Kaua‘i's resilience, supported by continued investment in construction, healthcare, infrastructure improvements, and community development projects.
The report also forecasts modest growth in visitor arrivals during 2026, supported by a strong start to the year, although tourism activity is expected to soften as higher airfare costs affect travel demand. Kaua‘i's labor market is expected to remain stable, with unemployment projected to stay low, while construction continues to be one of the island's strongest-performing sectors. At the same time, inflation and elevated energy costs are expected to place additional pressure on household budgets, and housing affordability remains a significant challenge due to limited supply and high home prices.
While UHERO forecasts that Kaua‘i is expected to avoid a recession under current conditions, the report notes that economic growth will remain modest and vulnerable to additional increases in oil prices and broader global uncertainty. The findings underscore the importance of continued investment in infrastructure, housing, workforce development, and economic diversification to strengthen Kaua‘i's long-term economic resilience.
The Office of Economic Development extends its appreciation to the community partners who participated in discussions with UHERO and provided valuable input that helped inform and refine the report's findings.
The Office of Economic Development invites the public to review the 2026 Kaua‘i Economic Outlook Summary and learn more about the economic trends, opportunities, and challenges shaping Kaua‘i's future.
To view the report, visit kauaiforward.com/services/data or www.kauai.gov/OED.
For more information, please contact the Office of Economic Development at 808-241-4946 or oed@kauai.gov.
If you need an auxiliary aid/service, other accommodation due to a disability, or an interpreter for non-English-speaking persons, please contact the Office of Economic Development at 808-241-4946 or oed@kauai.gov as soon as possible. Requests made early will allow adequate time to fulfill your request. Upon request, this notice is available in alternate formats such as large print, Braille, or electronic copy.
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