HONOLULU -- A local economist on Thursday said 2010 may be a year of stabilization, but it might take another year before Hawaii sees a sustained recovery.

First Hawaiian Bank economic adviser Leroy Laney said Hawaii's economy looks like the letter "L." He said recovery will be slower than the rapid descent into recession.

"Next year may be a year of stabilization in the Hawaii economy, but it will likely be 2011 before sustained economic recovery sets in, in spite of an improving picture at the U.S. national level and tenuous recovery in Japan," Laney said.

Laney said he is worried about tourism and the construction industry. He predicted the unemployment rate could go from the expected 7.2 percent this year to 7.5 percent next year.

Laney said his forecast is actually more optimistic than other local economists.

"We are still contracting here in Hawaii and so you would expect the unemployment rate to go up. It could get up higher than what I forecasted this morning. It could get up to 8 percent," Laney said.

Laney believes mass transit will help the local economy, but will take time to ramp up.

Some Democrats have criticized Gov. Linda Lingle's trip to China to promote tourism, saying she should have stayed home to fix the budget crisis and reach deals with the labor unions. However, two prominent economists are praising her, saying Hawaii should target Chinese visitors instead of relying on Japan.

Laney, and national economist James Smith, spoke Thursday morning at the Dole Cannery ballroom.

"I think she's brilliant. You've got to get Chinese people coming to Hawaii. Consume that way. That's the way of the future for the next 25 years," Smith said.

A growing population is an indication of a strong economy, economists said. China is growing while Japan's population is shrinking. Smith called Japan's economy a "basket case."