Alaska Economic Trends
Alaska Economic Trends is a monthly magazine that covers a range of economic topics.
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Most Alaskans are involved in the Leisure & Hospitality sector of the economy in one of two ways: either they are employed in it, or they patronize its hotels, health clubs, bingo parlors, ski resorts, performing arts, or restaurants. In 2002, the Leisure & Hospitability sector generated nearly 30,000 jobs in Alaska, which amounted to ten percent of the wage and salary workforce. (See Exhibit 1.) More than a billion dollars is spent every year in Alaska on its varied offerings.
Throughout its history, Alaska has had a large number of nonresident workers employed in the state. These workers were required to meet the seasonal demands of resource based industries or to meet the needs associated with major project development. The fast paced growth of the early 1980s, particularly in the construction industry, served as a magnet for a large number of nonresident workers, but also served as an impetus for special Alaska resident hire preference legislation.
In the last decade, the communities of Southeast Alaska have followed divergent economic paths. Juneau, the state's capital, has seen steady growth, while much of the rest of the region has seen heavy job losses in the timber and fishing industries. Although intuition might suggest that Juneau's growth has been the result of growing government, such intuition would be mistaken.
Alaska added about 4,500 new jobs in 2003, continuing an impressive sixteen consecutive years of employment growth. Slightly more than half of the new jobs were in health care and social assistance. The state's 1.5 percent growth rate in 2003 was down from the levels of the last three years, but was still healthy compared to most of the country, which continued to struggle to create jobs following the 2001 recession.
Alaska has produced job growth for sixteen consecutive years, and is expected to add two more years to the streak in 2004 and 2005. (See Exhibits 1 and 2.) Growth rates of roughly two percent from 2000 to 2002 slowed to 1.5 percent in 2003 and are expected to remain near that level for the next two years.
For years Alaska was correctly considered one of the most expensive places to live in the nation. As recently as 1997, the American Chamber of Commerce Researchers ( ACCRA) cost of living survey listed four Alaska cities in the eight most expensive cities in the U.S. By 2003, only Juneau and Kodiak made the top twenty and they were down to 16th and 17th, respectively.
Of all the factors that influence the growth or decline of a population, migration is the most important and the most difficult to study and understand. Migration involves movement of a person between two geopolitical locations over a period of time. Different types of migration data yield different insights into how people move in response to economic and other conditions.
For the third year in a row in 2003 and probably for many more to come, Providence Health System Alaska graced the top of the list of Alaska's largest employers. Just a decade ago Providence had fewer than 2,000 employees. Its workforce of 3,556 is approximately 120 more than it was in 2002. Safeway/Carrs was the runner-up for the third year in a row with 3,135 employees. These two are the only employers that have broken the 3,000 barrier and it probably will be years before any others reach this number.
The number of jobs in Alaska is expected to grow to 335,500 by 2012, an increase of more than 43,000. The forecast can be characterized by continued growth in the near term, with accelerated expansion near the end of the forecast period. The quickening growth pace during the coming ten years is in part the result of one of the major assumptions in this forecast that construction of an Alaska gas pipeline will start in 2012.
What will the occupational mix of Alaska's economy look like a decade from now? In which occupations will increases be necessary to meet the demands of an evolving job market over this period? These are important questions for the future of our state, with ramifications for educators, training providers, and policy makers on the one hand, and on the other, for the Alaska workers who will ultimately fill these positions.
Few economies, if any in this state, have bragging rights equal to those of the Kenai Peninsula Borough. Most communities struggle to diversify their economies, but the Kenai Peninsula accomplished this long ago. Fishing, the visitor industry, oil and gas, refining, government, and its attractiveness as a haven for retirees, are the fundamental economic drivers of the Kenai Peninsula economy.
In many ways the term 'Alaska fisheries' is both vague and misleading. It is vague in the sense that these fisheries include both small-scale ventures such as clam digging and the industrial levels of investment and organization required of modern factory trawlers. The former are often sources of supplemental income, while the latter involve the financial complexities of corporate owned fleets of high volume catcher-processors.