LIHU'E, Kaua'i — Even if Congress cobbles together a "bailout" of the financial crisis this week, the best that Hawai'i residents can hope for is an improving economy in 2010 or 2011, according to two prominent local economists.

"There are lots of statistics that indicate we're in a recession," Jack Suyderhoud, a University of Hawai'i business economics professor said in remarks prepared for delivery last night. "Manufacturing, consumer confidence, unemployment. ... Most of us recognize we're in a recession even though it's not been officially designated as such."

Suyderhoud and Hawai'i Pacific University professor Leroy Laney delivered their forecast at the First Hawaiian Bank Kaua'i County Economic Outlook Forum. Laney, a professor of economics and finance, also serves as an adviser to First Hawaiian Bank.

Hawai'i residents should tighten their budgets to "weather the storm" through the lean years ahead, the two said in an interview before addressing the forum at the Grand Hyatt Kaua'i Resort.

The Kaua'i event is the first in a series of First Hawaiian economic outlook presentations on each major island — Maui and the Big Island this month and O'ahu on Nov. 19.

"We've had a pretty good run of it, with 11 years of expansion," said Laney. "We've been predicting a slowing economy at least a couple of years. No expansion lasts forever."

Still, a series of economic blows for Hawai'i and the nation has come pretty fast and hard in 2008, Laney said.

For the state, there were the losses of Aloha and ATA airlines and cruise ship cutbacks, plus slumps in retailing and housing markets. A weakening in the national economy and the high price of oil both have affected Hawai'i's tourism.

For Kaua'i in particular, there's the recent announcement that Gay & Robinson has planted its last sugar cane. While an energy company is trying to move forward with plans to hire Gay & Robinson workers to grow cane for ethanol production, the deal hasn't been completed, Laney noted.

Alternative energy — ranging from solar and wind to fuel crops and geothermal — could end up being the "silver lining" in the high price of oil, Laney and Suyderhoud agreed. If local companies can take advantage of the cost-effectiveness of the alternatives in the face of high oil costs, it could end up being a good thing.

Also on the upside for Kaua'i: The Pacific Missile Range Facility, with its estimated $160 million impact on the local economy each year, and the four seed corn companies that infuse about $40 million a year, are both expected to continue going strong despite the slowdown in the overall economy.

Laney and Suyderhoud expect Kaua'i and statewide unemployment rates to rise in 2009 and tourism to stay down compared to recent record highs.

"We often forget that when the economy enters a phase of no growth or contraction that it is usually following a record level of real economic activity," Laney said. "We actual need occasional slowdowns for some things to catch up," he said.

On Kaua'i this could mean a cooling of the building boom in Kaua'i's Po'ipu area. However, several major construction projects remain on track, including the Kukui'ula luxury subdivision, the Kaua'i Lagoons Marriott time share and Ritz Carlton residence projects, and renovations of the Princeville hotel into a St. Regis hotel.