The Anchorage Economic Development Corporation (AEDC) hosted its annual Economic Forecast Luncheon on Wednesday. The event is a chance to review the economic situation of the past year and look to the current year and what to expect for the future.
AEDC President & CEO Bill Popp gave the Anchorage Economic Forecast. A quick review of 2017 highlighted that while we lost jobs in 2017, it wasn’t as bad as was predicted at the 2017 Forecast Luncheon. There were 2,100 fewer jobs in 2017, which is a 1.4 percent drop from the previous year. Unemployment in Anchorage was an average 5.7% during 2017. Job losses across sectors have started to moderate and were not as large as in 2016. Healthcare is still the one sector that continues to do well, and gained 800 jobs in the past year.
The Business Confidence Index report always provides great insight into the minds of business leaders in Anchorage. Over 300 businesses responded to the survey and provided insight into six indices on the confidence level for Anchorage’s economy. Four of the six indices were lower than last year. Only the overall composite Business Confidence Index and the Anchorage Economy Index were higher than last year. The confidence in the Anchorage economy grew significantly by 8.8 points. It is still below 50, which means that most survey respondents are pessimistic about the Anchorage economy. The other indices dropped only slightly from last year. The largest decrease was only 1.2 points for the Employment Index. Businesses seemed to be ambivalent to the local economy and with the exception of the increase in the Anchorage Economy Index, all others were relatively stable.
The Consumer Confidence Index continued to increase overall in 2017, but showed ups and downs during the year. The composite rose to 54.3. All three indices that make up the composite increased, Local Economy Confidence, Personal Finance Confidence and Expectations were 53.1, 65.4 and 49.3 respectively.
Popp continued with the 2018 forecast. This year’s forecast predicts another year of decline in Anchorage, but the decline will not be as significant as years past. Overall, the prediction is that we will lose 1,000 jobs, a 0.7 percent decline. Much of the decline is expected in the support sector, due to the previous years’ losses. “While AEDC believes that 2018 will be the bottom of the recession, without a long-term solution to Alaska’s budget deficit, full recovery may remain elusive. The absence of State budget and taxation certainty promises to unnecessarily sideline investment.”
The takeaway from the lunch was that there will still frustration regarding the state’s fiscal crisis. Optimism is better than it was, but many are still cautious about what the future holds for the economy in Anchorage and throughout the state.
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