By: Scott Goldsmith
Alaska wage and salary employment continued to grow in the first half of 2015 according to the latest information from the Alaska Department of Labor. Increased private sector employment more than offset a decline in public, mostly state government, employment. However growth slowed over the first two quarters of the year and will probably turn negative before the end of 2015 as the construction and petroleum industries contract.
Construction employment was higher for the 4th year in a row, but will soon start to contract due to both a decline in state government capital spending and reduced spending by the petroleum sector. This is evident from a decline in employment in professional services, a leading indicator of activity in the construction sector, which began last year.
Petroleum employment peaked at the end of 2014 and started to fall off at the beginning of this year. The decline will continue due to the Shell pullout and the completion of the Pt. Thomson project.
Employment in health care, which has been a major contributor to growth for several years, has not increased in two years and is unlikely to be a strong economic driver in the near term future.
However the decline in federal civilian employment since 2010 may be nearing an end, and this will help to stabilize the economy.