Alaskanomics

Third Quarter Employment Numbers

The employment numbers for the third quarter of 2019 show that employment has continued increase throughout the state and the unemployment rate remained relatively flat for the quarter.

In July, employment was up 0.5 percent, approximately 1,800 jobs from last July. Construction continued to see the largest gain with an increase of 600 jobs for the month. Oil and Gas was not far behind with an increase of 500 jobs. Growth was steady in the private sector, but there were still areas to see a decrease. Financial Services and the Information Sector lost 400 and 300 jobs, respectively.  

Within the public sector, both Federal and State jobs increased with 400 and 300 more jobs than in July of 2018, respectively. A lot of the job growth came from an increase in staffing due to a busy fire season. Both the Alaska Department of Natural Resources and the federal Bureau of Land Management added jobs during the fire response.

Alaska’s seasonally adjusted unemployment rate fell to 6.3 percent in July, which was still higher than the national rate of 3.7 percent.

August’s employment growth was only slightly up from August 2018, but there was still an addition of about 400 jobs, which is a 0.1 percent increase. Construction and Oil and Gas added the same amount of jobs in August as they did in July. Manufacturing and Financial Services saw the largest loss, each losing 300 jobs.  

In August, the seasonally adjusted unemployment rate dropped slightly to 6.2 percent, while the national rate remained at 3.7 percent.

September saw another large jump with an increase of 2,000 jobs, which was a 0.6 percent increase over September 2018. Construction continued its large gains adding 800 jobs over last year. Oil and Gas and Leisure and Hospitality also grew with 500 and 400 jobs, respectively.

State government lost 400 jobs from last year, mostly due to cutbacks at the University of Alaska due to significant cuts in state funding.

The seasonally adjusted unemployment rate remained at 6.2 percent, but the national average dropped slightly to 3.5 percent. The not-seasonally adjusted rate followed the usual fall pattern with rates rising in nearly all areas of the state. Tourism and fishing drove a lot of the movement in the rates as things started to wind down for the winter.

Up-to-date employment numbers can be found at the State of Alaska’s Department of Labor and Workforce Development’s website.

December and January Employment Numbers

Employment numbers from the Department of Labor and Workforce Development show that while December employment was down and estimated 0.3 percent from December 2017, January employment rose an estimated 0.2 percent from January 2018.

During the month of December, Alaska lost about 900 jobs, with retail, manufacturing, and professional and business services each losing 400 jobs. Health care continued to add jobs, with an addition of 400 jobs to wrap up the year. Alaska’s seasonally adjusted unemployment rate was 6.3 percent in December. This is higher than the national average of 3.9 percent.

In January, Alaska gained 500 jobs. The biggest increase can from construction that added 800 jobs over January 2018. Health care continues to grow, with an addition of 400 jobs. State government, oil and gas, transportation, warehousing, and utilities, and local government all added jobs in the first month of the year.

Alaska’s seasonally adjusted January unemployment was 6.5 percent, a little higher than December’s rate. Not-seasonally adjusted rates rose in all areas of the state, other than Aleutians West and East, which had the lowest rates due to winter fishing. Skagway and Denali had the highest rates in the state at 21.6 and 21.2 percent, which is normal due to the off-season for tourism. Anchorage and Juneau had lower rates than the state’s average, which Fairbanks was just over the state’s average.

 

Full employment data can be found at http://live.laborstats.alaska.gov/labforce/

 

November Employment

November employment was down 0.4 percent from 2017. That equals roughly 1,300 jobs. Retail had the largest loss of jobs with over half at 700. Professional and business services and manufacturing each lost 500 jobs. Health care continues to add jobs with an additional 500 jobs over last year. Transportation, warehousing, and utilities and construction both had gains with 300 and 200 respectively.

Alaska’s seasonally adjusted unemployment was 6.3 percent in November. This is down one-tenth of a percent from October. This is still well above the national average, which was 3.7 percent in October.

Not-seasonally adjusted rates were higher in nearly every borough and census area, which is normal this time of year. Denali and Skagway rates doubled between October and November, which is common due to their reliance on tourism. Some areas had rates below the state’s average. Aleutians East Borough and Aleutians West Census area were still low with 5.1 and 4.5, respectively. Even though fishing is dying down for the season, these areas still had low rates on average. Sitka, Juneau and Anchorage all had rates well below the state’s average with 4.0, 4.6, and 5.1 percent respectively.

For full employment numbers, visit the State of Alaska's page.

April Employment Numbers

April unemployment numbers were released by the Alaska Department of Labor and Workforce Development and are unchanged from the prior month. Preliminary numbers show that employment was down 1,200 jobs, which is about 0.4 percent.

The three industries with the largest declines in April were retail (-600), oil and gas (-500) and local government (-500). Health care and manufacturing added jobs with 1,000 and 400 respectively. A potential good sign is that construction had the same amount of jobs in April 2017 as it did in 2018, which may signal future growth. Construction has seen big losses in the recent past, and this might be the start of a turnaround.

Even with the good news in construction, April 2018 was the 31^st consecutive month that Alaska has lost jobs. This is six months longer than the job loss during the 1980’s recession. Even though this recession has had a longer period of job loss, the losses were deeper in the 1980s.

The seasonally adjusted unemployment rate for April was 7.3, which is where it has been for the past four months. The rate is only slightly higher than the 10 year average of 7.2 percent, but is well above the national average which is 3.9 percent, which is the lowest it has been in 18 years.

There have not been any significant or surprising changes to the not-seasonally adjusted numbers. Tourism and fishing has brought increases to the usual boroughs and census areas. For detailed statistics, please visit the State of Alaska.

Alaska's 2018 Construction Spending Forecast

Construction spending in Alaska this year will be around $6.6 billion, up 4% from 2017. But that overall increase is due just to a recovery in spending by the petroleum industry, which is expected to be up about 15%, to nearly $2.6 billion. 
 
Without petroleum, overall construction spending in 2018 is likely to be down about 2%, to $4.1 billion. But even though a number of sectors will spend less, some kinds of spending—particularly for national defense—will be up. 
 
These estimates are from the newly released 2018 construction forecast, prepared by Scott Goldsmith, professor emeritus of economics at ISER, for the Associated General Contractors of Alaska and the Construction Industry Progress Fund. He has made these forecasts of construction spending every year since 2004.

Download Alaska's 2018 Construction Spending Forecast (PDF, 1.6MB).

August Unemployment at 7.2 percent

Alaska’s seasonally adjusted unemployment rate continues to creep up and was at 7.2 percent in August. This is two-tenths of a percent higher than the rate in July and much higher than the national rate of 4.4 percent.

Employment continues to drop and preliminary numbers show a loss of 4,800 jobs in August, compared to August last year. Most job losses were from industries related to oil and gas. Industries that saw an increase over last year are health care, local and federal government. Anchorage and Mat-Su saw the largest decrease in jobs, losing 3,100 jobs over last year. The Northern Region, which includes the North Slope lost 1,000 jobs during the same time frame.

August still has strong tourism, fishing and construction numbers and low unemployment numbers for those census areas.

Complete employment numbers are located at the State of Alaska’s Department of Labor and Workforce Development website.

2016 Economic Forecast Events

Tis the season for forecast luncheons throughout Anchorage. One of the largest business events of the year is the AEDC Economic Forecast Luncheon, held on Wednesday, January 27. The format was like past events, with an introduction from the Anchorage Mayor, the Anchorage Economic Forecast from AEDC President and CEO Bill Popp, and a keynote address.

Mayor Berkowitz kicked off the presentations by saying that he has two sets of responsibilities in Anchorage, foundational and aspirations. He continued by sharing his vision for Anchorage in the coming year. He said the municipality will focus on public safety by working to increase the number of police officers from 350 to 400 officers. He also wants to help make Anchorage attractive for investment that will help the state as a whole. The Mayor said that we need big thinking to fix the affordable housing issues in Anchorage and address the issue of homelessness in our city. The Mayor concluded with a list of how his administration has managed resources well and decreased the budget to a level that is sustainable.

The focus of the luncheon was Bill Popp’s presentation of the 2016 forecast. The complete forecast is at aedcweb.com. Population is expected to go down approximately 2,200 people, which is higher than the loss of 1,500 seen in 2015. As was the case last year, many of those individuals will move out of Anchorage to the Mat-Su Valley to find a break in housing costs and availability. There could also be significant losses if there is a troop reduction at JBER. We will know later this spring if that will occur.

The jobs forecast also shows a reduction, but less than the population decrease. Anchorage is predicted to lose 1,600 jobs during 2016. The largest reductions will be seen in Oil and Gas (-600), Government (-500), Construction (-400) and Professional and Business Services (-400). The biggest winner will be Healthcare, which is predicted to add 300 jobs this year. The industry has added 5,000 jobs in the past ten years. The loss of 1,600 jobs is about 1 percent of the Anchorage job market.

Popp continued with the Business and Consumer Confidence Index reports and the reports illustrated how the state’s fiscal crisis was beginning to erode the faith of local Anchorage business leaders and the public. The composite of the index is at its lowest point since the survey was started in 2009. The composite index is at 48.8, down 7.2 points from 2015. Business leaders are now pessimistic when it comes to the Anchorage economy. The most significant change in this year’s report was the index that reflects the Anchorage economy. It was down from 46.9 in 2015 to 32.8 this year. Business leaders are mildly confident in their own business but are pessimistic about the state situation. 89 percent believe that it is a barrier to growth in the coming year.

The presentation concluded with the message that there is an upside to the forecast. Anchorage has the ability to invest in ways to improve the lives of residents and the work climate in the city. It is also possible to fix the fiscal crisis this year, which would go a long way to rebound the confidence of business leaders and individuals.

The Associated General Contractors of Alaska hosted their annual Spending Forecast event and released the 2016 Alaska’s Construction Spending Forecast on Thursday, January 28. Like many other sectors, spending in the construction industry is predicted to be down in 2016. The drop will bring the industry back to the levels of a few years ago before there was a bump in spending in 2014 and 2015. The bright spot in the forecast is that federal spending will increase, mainly due to Department of Defense spending. Tourism, fishing and air cargo is also likely to increase. These industries are aided by the low oil prices and the state will benefit from increased activity.

The short term outlook for construction spending will be challenging, but many feel that the industry will get through the rough patches and will be better off in the long term. The full report is located at agcak.org

Alaska Unemployment at 6.8 percent in May

The State of Alaska, Department of Labor and Workforce Development released its unemployment numbers for May. The seasonally adjusted unemployment rate remained relatively unchanged at 6.8 percent. This is only one-tenth of a percent higher than it was in April. It is still above the national average, which was 5.5 percent in May. In comparison, the non-seasonally adjusted rates fell four-tenths of a percent. This is common with the increase in summer tourism throughout the state.

Most boroughs and census areas had a decrease in the unadjusted rates for April. Denali Borough had the biggest drop going from 17 percent to 5.1 percent. Summer tourism is responsible for much of the increased employment in Alaska. The areas that had an increase in unemployment were the North Slope Borough, Kodiak Island Borough, Aleutians East Borough and Aleutians West Census Area. The North Slope is typically stable throughout the year, but had an unusual winter construction season. The other three are usually different than the rest of the state because of the increase in employment during the winter fishing season.  

Detailed employment statistics can be read at http://live.laborstats.alaska.gov/ces/index.cfm

Unemployment in March at 6.5 Percent

The Department of Labor and Workforce Development released the March unemployment rate early this morning. The rate for March was up slightly from February and stands at 6.5 percent. The national average remained steady at 5.5 percent.

The not -seasonally adjusted lowest and highest rates in the state remained the same with the Aleutians East Borough and Aleutians West Census Area being the lowest at 3.2 and 2.6 percent respectively; and Wade Hampton Census Area the highest at 26.6 percent.

As part of their monthly press release, the Department highlighted the job numbers of the different regions throughout Alaska for the 1^st quarter of 2015.

• Anchorage’s retail trade was the biggest source of new jobs, while professional and business services had the largest losses. The lack of snow cut into winter recreation, which created weakness in the leisure and hospitality industry.
• Southeast jobs were lower than the same period last year due to the less-than-usual growth in construction and seafood processing.
• Southwest was also lower than last year even with the seasonal growth from winter fishing.
• The Gulf Coast saw gains in seafood processing, mining, and leisure and hospitality that balanced out the loss in health care and government jobs.
• The Interior, including Fairbanks, had a small loss in jobs, but health care in the region is growing.
• The Northern Region had an increase in jobs from the same period last year. Health care increased, as did local government.

For full employment statistics, visit www.laborstats.alaska.gov

Anchorage Housing Gridlock and Density Discussion

For many in Anchorage, the reality of homeownership is out of reach. According to a recent presentation from the Housing Subgroup of the Live.Work.Play initiative, Anchorage is the 19^th most expensive city in the US and 21^st most expensive when it comes to housing. The lack of affordable housing is not just a concern for individuals, but also for businesses trying to hire new employees from out of state. The Anchorage Economic Development Corporation (AEDC) conducted a survey of Anchorage employers to determine the biggest concerns of employers and employees in the Municipality. The number one concern of employers was being able to attract and retain good employees and a large part of that was being able to have housing for their employees. Companies have had individuals turn down jobs in Anchorage because of the lack of affordable housing. There is a lack of selection and of quality, especially in rental properties. Many potential employees cite that it is too difficult to move to a new, high cost area with the uncertainty of a new job and without affordable housing.

Many issues have created the housing gridlock being seen in Anchorage. Available land for new developments, the cost of construction/renovation, and the difficulty of navigating the permitting process have all lead to the housing crunch. A solution to this issue is to reconsider housing density.  There are many ways to create more dense housing in Anchorage without building skyscrapers that house hundreds of residents. Density is an important concept that helps maximize the value and utility of land.

At a discussion hosted by Housing Anchorage, attendees wrestled with the best way to consider approaching the subject of density in Anchorage. Many noted that perceptions and misconceptions about density would need to be changed before moving forward to find a solution. Everyone agreed that it would be helpful to have a successful example of more dense housing in Anchorage to use as an example in moving forward. Creating higher density housing would break up some of the gridlock being seen and allow for more flexibility in the housing market. A representative from the Municipality’s Planning Department noted that the department was going to target certain areas of the Municipality for higher density projects. A shift to higher density would only be made in areas where it was appropriate and it would be strategic.

Discussions regarding housing in Anchorage are continuing and include a variety of subjects and potential solutions. For more information, visit www.aedcweb.com.