Hawaii saw 13.7% increase in transfer dependency percentage between 1970 and 2022

In 2022, government transfers accounted for 18.2% of total income in Hawaii, a 13.7% rise from 4.5% in 1970, and a 3.1% increase over 2012’s 15.1%, according to information from the Economic Innovation Group. On a per capita basis, this equates to $11,236 per resident in 2022, up from $8,071 in 2012 and $1,466 in 1970.

Among Hawaii’s counties, Honolulu County saw the largest increase in transfer dependency over the past 10 years, surging 3.1% from 13.5% in 2012 to 16.6% in 2022, and up 12.5% from just 4.1% in 1970. In dollar terms, government transfers per capita in Honolulu County jumped from $7,788 in 2012 to $10,759 in 2022, a stark contrast to the $1,387 recorded in 1970.

Hawaii County followed with the second-largest increase in transfer dependency, increasing 2.7% from 24.4% in 2012 to 27.1% in 2022, and an overall increase of 19.8% from 1970’s 7.3% transfer dependency. This trend is reflected in per capita amounts, with residents of Hawaii County receiving an average of $13,412 in transfer income in 2022, up from $9,715 in 2012 and more than double the $1,387 recorded in 1970.

Additionally, Hawaii County had the highest percentage of income derived from government transfers, at 27.1% in 2022, making it the county with the highest overall transfer dependency. Kauai County and Maui + Kalawao County followed closely behind, with transfer dependency rates of 22.3% and 17.8% in 2022, respectively.

Compared to 1970, Hawaii County increased by 19.8%, while Kauai County and Maui + Kalawao County have increased by 14.9% and 10.6%, respectively, showing sustained reliance on government transfers. Residents in Hawaii County received an average of $13,412 in transfers per capita, with Kauai County and Maui + Kalawao County close behind at $12,656 and $10,755, respectively.

For comparison, the statewide average was 18.2% in 2022, showing a higher dependency than the national average of 17.6%. On a per capita level, this translates to $11,236 per resident in 2022, compared to $11,542 nationwide.

Government transfer payments are non-repayable funds provided by federal, state, or local governments to support individuals in need. These payments aim to stabilize economic conditions and provide financial support during hardships. Key programs include Social Security transfers (retirement benefits), Medicare transfers (healthcare for seniors), Medicaid transfers (healthcare for low-income individuals), and income maintenance transfers (financial assistance for basic needs).

In Hawaii, reliance on government transfers was just 4.5% (or $1,466 per capita in inflation-adjusted 2022 dollars) in 1970. This has since increased to 18.2% (or $11,236 per capita) in 2022, reflecting a total increase of 13.7% since 1970. This shift is largely influenced by increased healthcare costs, and economic transformations that have reshaped income sources across the U.S.

In 2022, the primary government transfer programs in Hawaii included:

• Social Security: $3,795 per capita (33.8% of total transfers)
• Medicare: $2,415 per capita (21.5% of total transfers)
• Medicaid: $2,218 per capita (19.7% of total transfers)
• Income Maintenance Programs: $1,528 per capita (13.6% of total transfers)

With 18.1% of the population aged 65 and older, Hawaii has a significant demand for programs like Social Security and Medicare. However, counties with higher poverty rates also show elevated Medicaid and income maintenance participation.

Government transfers have long been a modest financial safety net, historically comprising only a small fraction of Americans’ income. However, since the 1970s—sometimes dubbed the “Great Transfer-mation”—dependency has surged from 8.2% (or $2,022 per capita in inflation-adjusted 2022 dollars) in 1970 to 17.6% (or $11,542 per capita) in 2022 nationwide. In Hawaii, reliance on government transfers has similarly increased from 4.5% (or $1,466 per capita) in 1970 to 18.2% (or $11,236 per capita) in 2022, reflecting broader national trends.

According to the Economic Innovation Group’s analysis, these trends are not merely short-term responses to economic pressures but rather reflect a profound, long-term transformation in how government support is integrated into American life. The study illustrates that structural shifts—from rising healthcare expenses and demographic changes to stagnant wages—have significantly increased dependency on government transfers.