Hawaii is the only archipelago state out of 50 united states. It is 2,000 miles away from the US mainland on the pacific island. Hawaii was an independent state before 1959 when it was admitted to the United States of America. Due to its distance from the USA’s mainland, Hawaii has to import most of its necessary goods. Secondly, the state also has limited ports that overall increase the cost of every basic utility. With over 1.4 million population, Hawaii is one of the most expensive states in the USA. But why is Hawaii so expensive?
Hawaii is an isolated state of American states in the Pacific Ocean. Additionally, housing, energy, and labor cost are also high in the state. The taxes in Hawaii are also one of the highest in the USA which makes the state so expensive.
Housing Is Expensive In Hawaii
Hawaii is a beautiful place for vacations and holidays. But after having a vacation in Hawaii, you are planning to get a house here and settle down then think twice. The cost of housing in Hawaii is three times the average housing cost in the USA. It is the highest variation in the housing cost in the country.
The reason behind the high housing rates is limited real estate transitions. Housing constitutes a huge portion of people’s income in Hawaii. Various surveys also say that Hawaii is the most unsuitable living destination among the 50 US states.
Lack Of Resources
Hawaii has very limited resources that are grown or manufactured in the state. It has to import 90% of its necessities. Hawaii is cut off from the rest of the USA. Therefore, the cost of imports is also high in the state. Secondly, there are limited ports in the state. All these factors together increase the overall cost of products.
The cost of transportation directly affects the prices of everything that people use. The same is the case in Hawaii. That is why the residents, as well as travelers, experience high prices in Hawaii.
The excise taxes are very high in Hawaii. It is among the highest excise tax-collecting state in the USA. A large part of people’s income vanishes in taxes. Excise taxes are not additionally charged on your bills. It is a hidden tax on the cost of items that you bought. Because of the high taxation, most items in the state are more expensive than in the rest of the country. It makes Hawaii, the most expensive state in the USA.
High Cost Of Energy
Hawaii depends on imported fuel for generating electricity in the state. Therefore, the prices of electricity are also very high in the state. After housing, electricity constitutes a large portion of people’s regular expenses.
Secondly, Hawaii is a chain of islands. Therefore, the power generating stations are also so isolated. This is also one of the reasons for high energy prices in the state. Hawaii’s power consumption is among the lowest in the state. Still, it faces the highest prices in the country.
Scare Of Labor
The income Hawaii offers is very competitive with other US states. But the expenses it gives are the highest in the US. That is why even after high income, more people do not wish to settle in the state. Secondly, the state is surrounded by water everywhere. Therefore, it cannot attract much labor from other states.
When the demand for labor is high, and to fulfill the demand skilled workforce is limited, salaries as well as the cost of production rise. This is also one of the factors creating Hawaii the most expensive US state.
Cheap Alternatives Are Not Available
In the US mainland, there are discount stores and departmental stores where basic necessities are available at the best prices. Bit it is not the case in Hawaii. Daily necessities like groceries, milk, eggs, etc. are very high due to excise duty and importing. And worse of worse, there is no substitute for these high-cost goods.
The retail store chain that dominates in Hawaii is Foodland. The departmental store like Walmart, Macy’s, Target, etc. are very limited in the state. And their prices are also more than other US states. if you choose to order items online, then also you have to pay delivery charges. The delivery charges for Hawaii are different and higher than any other US state. Therefore, anyhow people have to pay high prices for their daily utilities.
Traveling To Hawaii
Hawaii is an expensive state for both residents and travelers. The price of food and other necessities is the same for all. Then hotel costs and travel costs are also high. For a week trip to Hawaii, an average person has to spend around $2,000 on various things. It includes meals, accommodation, and transport. It is far more than the travel cost in any other US state. But its beauty is so magnifying, that spending a little more money for a week is worth it.
Hawaii is a beautiful place to travel. But to settle down is a challenging state. It is the most expensive US state. It is surrounded by water everywhere. That is why Hawaii people have to import almost everything they use. And where transportation is high, everything becomes expensive. It increases the cost of products they use. Secondly, housing and energy are also high in the area. All these factors together make Hawaii so expensive.
Frequently Asked Questions
- Does the average income of Hawaii is higher than the rest of the USA?
Answer: Yes, the average income of Hawaii is higher than the rest of the USA. It ranks among the top 5 income-generating states in the USA. However, the expenses are also equally high. So, what people earn is exhausted in their necessary expenses.
- What is the cheapest US state to live in?
Answer: According to data Mississippi is the cheapest US state to live in. the living cost of the state is 15% less than the average living cost in the USA. The median household income in Mississippi is also more than $45,000.