Hawai'i experienced a net loss of more than 9,600 residents who moved to the Mainland between July 2006 and July 2007, the largest exodus in at least eight years, according to newly released Census Bureau estimates.

Experts say housing prices, inflation and the growing gap between the cost of living here and on the Mainland are driving residents away.

With local employers already contending with low unemployment, the population trend could make it even harder to find workers, said Eugene Tian, research and statistics officer with the state Department of Business, Economic Development and Tourism.

"We need people, and people are moving out due to the cost of living and housing prices," he said. "Everywhere else on the Mainland there has been a decline in housing prices, but we don't see that in Hawai'i."

The Census Bureau data released yesterday estimated Hawai'i's population at 1,283,388, an increase of 5.9 percent since the 2000 Census. About 93 percent of the 71,851 new residents were the result of a "natural increase" — births minus deaths. The remainder was attributed to foreign and domestic migration.

Hawai'i had the nation's 23rd highest percentage increase in population from 2000 to 2007 and ranks as the 42nd most populous state.

The estimates also show a population increase of only 0.4 percent, or 4,753 people, from July 2006 to July 2007.

There was a "natural increase" of 9,996 newborns, according to the data. That gain was offset somewhat by a net migration loss of 5,561 residents during the same period, the first net loss since 2001.

The Census Bureau reported a net loss of 9,673 residents from internal migration to the Mainland. There was a net gain of 4,112 people from foreign migration.

Tian said the annual increase of 0.4 percent follows five years of higher population growth and harkens back to the late 1990s when Hawai'i's economy was stagnant.

He said there is a contradiction between Hawai'i's relatively low unemployment — 2.9 percent vs. 4.7 percent nationally — and the loss of workers to the Mainland. An explanation likely is found in the state's current inflation rate of 5 percent, double the national rate, Tian said.

Paul Brewbaker, Bank of Hawaii chief economist, said inflation is pushing the state's housing, food, gasoline and energy costs further from the national norm, making Mainland communities more attractive to Hawai'i residents.

"When we entered the 2000s, Hawai'i wasn't that much more expensive than the Mainland on average, and it was even cheaper than other places such as Orange County and San Francisco," Brewbaker said.

"That's changed. The gap is widening."

Other subtle signals of a weakening economy can be found in the upward creeping of the state's historically low unemployment rate, deceleration in growth of state tax revenues, flat visitor numbers and the stalled housing market, Brewbaker said.

He likened the economy to a vacuum. "When it expands, it sucks in resources such as workers from outside the state, and it abates its pull on external resources when it diminishes," he said.

Yet high prices and frenetic economic activity have many thinking the state's economy is still booming.

"That hasn't been the case for two straight years," Brewbaker said. "We're definitely having a softer landing than we went through in the 1990s, and it's been a more stealthy slowdown because the pace of economic activity by many of the real measures has stayed robust.

"We've been treading water since 2005 and working harder to stay in place both on the individual level and as an aggregate economy. ... The net loss in migration is consistent with everything we've talked about."

The large number of people moving out of state also illustrates how Hawai'i has become a more mobile society, like the rest of the country, according to Brewbaker.

The Census Bureau data show Hawai'i trailing all other Western states in population growth. Even Alaska, Idaho and Montana had higher percentage increases.

Geography is one reason, Brewbaker said, since it's much easier to travel between states on the Mainland. But he also feels that Hawai'i is no longer viewed as a "frontier economy" ripe with opportunity.

"We don't welcome people with new ideas who want to try new things," he said.

The nation's population, estimated at 301.6 million, grew 7.2 percent from 2000 to 2007, and 1 percent from 2006 to 2007, the Census Bureau said.

Nevada, a popular relocation site for former Hawai'i residents, returned to the top as the nation's fastest-growing state, with a population increase of 2.9 percent between July 2006 and July 2007.

Reach Christie Wilson at cwilson@honoluluadvertiser.com.

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