Construction firms continue to find federal subcontracting jobs in Hawaii. In this April 25, 2005 photo, Journeyman labor Toa Eva laid down iron work for the foundation of one of eighty six units being built in Nanakulipn the isle of Oahu as affordable housing. Honolulu Star-Bulletin Photo by Cindy Ellen Russell.

Native Hawaiian Business Booms

Rob Capriccioso
4/22/11

The U.S. Census Bureau is reporting a dramatic increase in the number of Hawaiian indigenous-owned businesses, calculating that revenue for “Native Hawaiian- and Other Pacific Islander-Owned Businesses” increased 52 percent from 2002 to 2007.

In a report released April 5, the Census Bureau announced that the number of Native Hawaiian- and Other Pacific Islander-owned businesses increased 31.1 percent between 2002 and 2007, to 37,957 businesses. The businesses earned $6.5 billion in receipts in 2007, which represented a 51.6 percent increase from 2002, the last year a similar study was released.

The economic boom was substantial, as the total number of U.S. businesses increased 17.9 percent between 2002 and 2007, while total business receipts rose 32.9 percent.

“These data confirm that businesses owned by Native Hawaiians and Other Pacific Islanders continue to grow both in number and in sales at rates that are faster than national rates for all businesses,” said Tom Mesenbourg, deputy director of the Census Bureau in a statement.

In Hawaii alone, the increase was 36.2 percent for indigenous businesses, while the overall increase in the number of all firms in the state was 21.3 percent.

Dirk Soma, president of the Native Hawaiian Chamber of Commerce, told the Star Advertiser that he expects the percentage of Hawaiian- and other Pacific Islander-owned businesses to fall in the next Census Bureau report because of the global economic collapse that began in 2008. Still, he said that many of the construction-related companies reported in the 2002-2007 survey are “small and nimble enough to have moved into different specialties, such as installing photovoltaic systems and other areas related to alternative energy." Plus, those firms that remain in construction continue to find federal subcontracting jobs in Hawaii and Guam, he said.

H. Wailana Kamauu Jr., president and CEO of Honolulu-based American LED and Energy, told the newspaper that he believes that many of the Hawaiian- and other Pacific Islander-owned businesses grew out of former employees who saw the slowdown coming in the economy and started their own companies. “They took opportunities,” he said. “The opportunities to grow in Hawaii are very good.”

Economic forecasters predict that challenges will continue to hamper the smallest Hawaiian- and other Pacific Islander-owned businesses, including access to capital and the struggles to expand and hire more employees, he added.

According to the report,  people of Native Hawaiian origin owned 55.6 percent of all Native Hawaiian- and Other Pacific Islander-owned businesses in 2007. Guamanian- or Chamorro-owned businesses represented 9.6 percent, Samoan-owned businesses were 8.0 percent, and businesses owned by people of Other Pacific Islander descent, accounted for 24.6 percent.

Other highlights of the survey, as listed by the Census Bureau:

  • States with the highest number of Native Hawaiian- and Other Pacific Islander-owned businesses were Hawaii, with 11,383 (30.0 percent of all Native Hawaiian- and Pacific Islander-owned businesses nationwide), and California, with 9,255 (24.4 percent).
  • Of the 37,957 Native Hawaiian- and Other Pacific Islander-owned businesses in 2007, 4,172 had paid employees. These businesses employed 38,750 people, an increase of 32.2 percent, and their payrolls totaled $1.3 billion, an increase of 54.1 percent from 2002. Employer business receipts totaled $5.4 billion, an increase of 54.4 percent. Average receipts of these firms were $1.3 million.
  • The number of Native Hawaiian- and Other Pacific Islander-owned businesses with no paid employees totaled 33,785, an increase of 33.8 percent. These nonemployers' business receipts totaled $1.1 billion. Average receipts of these firms were $31,991.
  • The number of Native Hawaiian- and Other Pacific Islander-owned businesses with receipts of $1.0 million or more was 884 in 2007.
  • The number of Native Hawaiian- and Other Pacific Islander-owned businesses with 100 or more employees increased from 28 to 37 (32.1 percent).
  • Construction and retail trade accounted for 44.1 percent of all Native Hawaiian- and Other Pacific Islander-owned business receipts.

The report is called the Survey of Business Owners: Native Hawaiian- and Other Pacific Islander-Owned Businesses: 2007. It offers detailed information every five years for Native Hawaiian- and Other Pacific Islander-owned businesses, including the number of firms, sales and receipts, number of paid employees and annual payroll. The survey defines Native Hawaiian- and Other Pacific Islander-owned businesses as firms in which Native Hawaiians, Guamanians, Chamorros, Samoans, and Other Pacific Islanders own 51 percent or more of the equity, interest or stock of the business.

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