In January, Carl Bonham and other economists in the College of Social Sciences began following news out of Wuhan, China, about a developing respiratory disease referred to as the novel coronavirus. Bonham, an economics professor and executive director of the University of Hawaiʻi Economic Research Organization (UHERO), remembered working on the organization’s first-quarter forecast report and watching a marked pullback in international passenger counts from Australia, China and South Korea. At the time, there were no signs of declining arrivals from the larger Japan and U.S. destinations.
In response to the growing risk, UHERO’s February 24 forecast, “Coronavirus Presents Danger to Hawaiʻi Tourism,” described a probable downside scenario similar to what the state saw during the SARS (Severe Acute Respiratory Syndrome) epidemic of 2002-2003.
But COVID-19’s impact and transmission speed would be more devastating than SARS. “Within a week of that report going out, it was clear that this was going to be a much bigger deal,” said Bonham. “By that time the disease had spread to Japan, Italy, Iran, South Korea and other countries, as well as two-thirds of U.S. states. This was going to be a huge blow to the global and Hawaiʻi economies.”
On March 10, UHERO released an urgent interim forecast update, “COVID-19 Will Impose Significant Economic Impacts in Hawaiʻi,” followed by a March 30 update, “Hawaii’s Economy is Shut Down to Deal with COVID-19.” Those predictions were part of a remarkably accelerated output of forecasts and opinion briefs that continue to be sought out by government leaders, business sponsors and the public.
UHERO was no longer a behind-the-scenes influencer. Suddenly, Bonham was appointed to the state Legislature’s Select House Committee on COVID-19 Economic and Financial Preparedness, and was being contacted daily by reporters, government leaders and business executives to answer questions about the depth and length of the economic downturn. He was working constantly, fitting in time between back-to-back video calls to update forecasts, gather data, and coordinate with forecast, project management and communications teams. The entire UHERO office was called upon to shift into overdrive, churning out forecasts and briefs for an audience hungry for relevant, timely data and guidance.
“UHERO is our main source for objective and authoritative information about Hawaii’s economy and its prospects,” said Mark Fukunaga, CEO of Servco Pacific. “With all of the volatility in the world, it is essential to know where you are and to have a sense of where you are headed, and UHERO helps us figure out those things.” Added Mike Fujimoto, chairman of HPM Building Supply on Hawaiʻi Island, “I commend UHERO for providing our communities with such a valuable resource. The economic data and its tremendous accessibility are golden, and will allow all of us to make better decisions for our institutions and our community.”
UHERO fellows have been particularly prolific. An April 3 policy brief authored by emeritus economics professor and UHERO co-founder and research fellow Sumner La Croix, and East-West Center senior fellow Tim Brown, titled “How to Control Hawaii’s Coronavirus Epidemic and Bring Back the Economy: The Next Steps,” was heavily quoted by government leaders and media. In addition, economics professor and UHERO research fellow Michael Roberts, and economics department chair and UHERO research fellow Tim Halliday, have been at the forefront of discussions about how Hawaiʻi might emerge and recover from the coronavirus crisis.
Coincidentally, COVID-19 is posing a threat to the current and future work of UHERO. Many of the sponsors and subscribers that underwrite forecasting and data-sharing efforts are from the hard-hit hospitality industry, which may result in reduced funding during this time of stepped-up need. In addition, with UHERO co-founder and key forecaster Byron Gangnes leaving the islands this summer, sustaining and expanding UHERO’s capacity to address this crisis, and the next, is a looming challenge for the organization.
“It is becoming increasingly evident that Hawaii’s battle with the novel coronavirus and its aftermath will not be a sprint, but a marathon,” said Bonham. “Whether in government or business, people view us as an objective and qualified data-based source to tell it like it is. UHERO is committed to meeting the needs of the state throughout this long journey.”
