Alaskanomics

Alaska's Economy - 2023 presentation

Northrim Bank hosted it's annual Community Summits in Soldotna, Anchorage and Fairbanks. Additional events will be held in Juneau, Sitka and Kodiak in the fall. As part of the summit, the attached presentation was given at these events.

March jobs up 2.3 percent from March 2022

April 21, 2023
No. 23-7

JUNEAU, Alaska — March’s job count was up 2.3 percent from last March, an increase of 7,000.

All Alaska industries grew over the year except Information, which was flat. Gains were largest in leisure and hospitality (+2,000) and transportation, warehousing and utilities (+1,400), both of which sustained some of the biggest pandemic losses and are now above or approaching pre-pandemic job levels.

Oil and gas employment was up 400 over the year, to 7,400, but remains nearly 30 percent below pre-pandemic levels and less than half what it was at its all-time high of 15,300 in late 2014.

The public sector was up over the year, led by local government, which includes public schools (+300). State and federal government each added 100 jobs.

The state’s seasonally adjusted unemployment rate was 3.7 percent in March and the comparable U.S. rate was 3.5 percent. Job openings are high, and Alaska and the nation both had more available jobs than workers. In February, the most recent month available, both had about one unemployed worker for every two job openings.

View data tables and charts (PDF)

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Labor force data home page

February jobs up 2.5 percent from February 2022

March 24, 2023
No. 23-5

JUNEAU, Alaska — February’s job count was up 2.5 percent from February 2022, an increase of 7,700 jobs.

Nearly all industries recorded growth. Gains were largest in transportation, warehousing and utilities (+2,300), leisure and hospitality (+2,100), and professional and business services (+700). Transportation, responsible for most of the growth in that sector, and leisure and hospitality sustained some of the biggest losses during the pandemic, but the transportation, warehousing and utilities sector is now above pre-pandemic job levels and leisure and hospitality and professional and business services are close.

The only over-the-year job loss was in manufacturing (-100), which in Alaska is mainly seafood processing and can vary considerably from year to year. Financial activities and state and federal government employment were flat over the year.

The state’s seasonally adjusted unemployment rate was 3.8 percent in February — no change from January’s revised rate — and the comparable U.S. rate was 3.6 percent, up from 3.4 percent in January.

View data tables and charts (PDF)

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Labor force data home page

2023 Economic Forecast Video Series

Using data and reports from its 2023 Economic Forecast, the Anchorage Economic Development Corporation created this video series examining the variables and trends influencing Anchorage’s economic sectors.

 

December jobs up 2.1 percent from December 2021

Jan. 20, 2023
No. 23-2

JUNEAU, Alaska — December’s job count was up 2.1 percent from December 2021, an increase of 6,400 jobs. Nearly all industries recorded growth, but most remained below pre-pandemic levels. Overall, Alaska had 4,900 fewer jobs than in December 2019. 

Over-the-year gains were largest in leisure and hospitality (+1,800), transportation, warehousing and utilities (+1,800, primarily in transportation) and local government (+800, all in public education).

State government (-600) and manufacturing (-300) were the only two industries down over the year. State government recorded small losses in multiple departments. Manufacturing employment in Alaska is primarily in seafood processing and changes considerably on a monthly as well as a yearly basis according to the harvest season, catch, and available workforce. December is the lowest employment month.

The state’s seasonally adjusted unemployment rate was 4.3 percent in December (down from 4.5 percent in November), and the comparable U.S. rate was 3.5 percent, down from 3.6 percent.

View data tables and charts (PDF)

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Labor force data home page

November jobs up 1.7 percent from November 2021

Dec. 16, 2022
No. 22-24

JUNEAU, Alaska — November’s job count was up 1.7 percent from last November, an increase of 5,200 jobs. Nearly all industries recorded growth, but most remained below pre-pandemic levels. Overall, Alaska had 7,600 fewer jobs than in November 2019. 

Alaska’s economy is the most seasonal among states, and November is part of the off season for many seasonal industries, such as seafood processing, tourism and construction. Typically, January has the year’s lowest job numbers.

Leisure and hospitality, an industry that was hit hard by the pandemic, added 2,100 jobs over the year. The industry depends heavily on summer visitors, but November jobs in restaurants, hotels, bars and other leisure and hospitality businesses mostly serve Alaska customers. Leisure and hospitality was still about 1,100 jobs below November 2019.   

The transportation, warehousing and utilities sector was up 1,100 jobs, primarily in transportation as residents traveled in and out of state at historically normal levels. Courier and package delivery services drove some of the increase with the start of holiday shopping. Transportation, warehousing and utilities has fully recovered from pandemic-related losses, to 800 more jobs than in November 2019.

Oil and gas employment was up 500 (to 7,200), but still 2,600 jobs below November 2019. Oil and gas lost 5,400 jobs during the state recession of 2015-2018, recovered 500 jobs in 2019, and then lost 3,200 in 2020 and 2021.

A couple of industries were down from last year: state government (-700), federal government (-100), and the combined category of private education and health care, which includes private social assistance (-600, all from social assistance).  

The state’s seasonally adjusted unemployment rate was 4.5 percent in November and the comparable U.S. rate was 3.7 percent, both unchanged from the month before. 

View data tables and charts (PDF)

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Labor force data home page

Juneau & Southeast Alaska Economic Indicators 2022 Report

The 2022 edition of the Juneau & Southeast Alaska Economic Indicators report was developed by the Juneau Economic Development Council (JEDC), with the support of the City and Borough of Juneau and corporate partners, including Northrim Bank.

The report includes a detailed snapshot of Juneau and Southeast Alaska along with employment and earnings data, demographic trends, an overview of education, housing and construction numbers, industry profiles and cost of living analysis. Click here to see the full report.

October jobs up 2.0 percent from October 2021

Nov. 18, 2022
No. 22-22

JUNEAU, Alaska — October’s job count was 2.0 percent above October 2021, a gain of 6,100 jobs. Most industries were up over the year but remained below 2019 levels. Overall, Alaska was down 10,800 jobs from the October before the pandemic began.

Although Alaska had moved past the peak visitor period by October, a small number of cruise ships continued to arrive through the middle of the month. Leisure and hospitality, along with the transportation, warehousing and utilities sector, were the biggest gainers — up 2,900 (9.7 percent) and 2,000 (9.6 percent) respectively over 2021 levels as local demand for eating and drinking and visitor demand for travel and accommodation picked up from last year. Transportation employment rose above pre-pandemic levels, and leisure and hospitality remained 1,700 jobs below.

The oil and gas industry’s recovery continued to lag the rest of the economy. Oil and gas employment was 300 above last year but still 2,700 below October 2019. This October’s industry job count (7,100) was less than half that of October 2014, just before the one-two punch of the recession and then COVID.  

Although most industries were up from year-ago levels, state and federal government and private education and health employment were lower than a year ago. The biggest losses came from state government (-900) and education and health (-400), a category that includes private social services, which registered the bulk of the losses. The federal government was down 100 jobs over the year.

The state’s seasonally adjusted unemployment rate was 4.5 percent, up a tenth of a percentage point from September. The comparable U.S. rate was 3.7 percent, up from 3.5 percent the month before.

View data tables and charts (PDF)

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Labor force data home page

Commercial property assessed clean energy

By Tim Bradner

Commercial property owners have a new tool to finance rehabilitation of older properties and to build money-saving energy conservation features into new construction.

It’s called Commercial Property Assessed Clean Energy, or C-PACE, and it allows certain types of property improvements to be financed with payments made as an assessment by a local municipality, much like sewer and water assessments are done.

Municipalities must first approve C-PACE lending and so far the Municipality of Anchorage and the Matanuska-Susitna Borough have done this. The Kenai Borough, Fairbanks North Star Borough and City of Borough of Juneau are studying the idea and will likely soon approve C-PACE lending. Similar programs are now operating in 30 states.

Alaska’s program is much more attractive, even compared with those in other states, after Alaska’s Legislature expanded an earlier, more limited C-PACE authorization, which was limited to financing energy conservation improvements to existing buildings.

The new legislation, in House Bill 227, sponsored by Anchorage State Rep. Calvin Schrage, allows lending for energy conservation in new as well as existing buildings along with “resilience” projects in buildings, which means structural strengthening to withstand natural events like windstorms and earthquakes.

Private lenders, like Northrim Bank, provide the financing but the repayments are administered by a municipality as part of a property tax or utility assessment.

HB 227 also allows refinancing, too, but the key advantage is that repayment to a lender can be stretched out with less up-front costs, again because the program works like traditional utility assessments.

Lower payments occur when a loan is paid off over a longer time period as compared with a shorter period, much like payments on a 30-year home mortgage compared with a 15-year fmortgage.

Jenny Willardson, a real estate broker in the Matanuska Valley, hopes the program will help jump-start needed commercial property development in Mat-Su, which needs to diversify its tax base away from residential properties.

Willardson said many existing commercial buildings in Mat-Su are older and in need to upgrades. “I work with business owners who are looking to buy or lease space and one of the most common problems in our site selection is that it’s difficult to find quality buildings that are well-maintained,” Willardson told Mat-Su’s borough assembly before they voted to approve C-PACE.

“Many of Mat-Su’s commercial buildings need improvements both structurally and aesthetically. C-PACE retrofits could facilitate some of these improvements, and because of the long amortization period, of 20 to 30 years, the cost to the owner becomes more manageable.”

The program will be particularly important to small businesses. “Many of these are local mom and pop investors or building owners, for whom raising capital can be more difficult than for an institutional investor,” Willardson told Mat-Su’s assembly.

The energy improvements typically lower operating costs and when energy costs rise the burden of those is felt to a greater magnitude by owners of less efficient buildings. Resiliency projects, protecting against natural hazards, typically lower insurance costs.

Overall, costs become more predictable, particularly through the energy retrofits.

“In theory, the low payments for the retrofit improvements would be offset by the savings in operating costs,” Willardson said. Lower operating and insurance costs can add value to a building for the owner.

Interest rates on loans tend to be lower too, based on experience with C-PACE in other states. Payments made as a part of a municipal assessment tend to have very low default rates and are considered less risky by banks.

Another feature of C-PACE is that the loan is tied to the building rather than the owner. If the property is sold the C-PACE loan goes with it, so that the new owner enjoys the same advantageous terms.

Alaska’s first C-PACE project, in Anchorage, was concluded by Connecticut-based Nuveen Green Capital and Northrim Bank. It involved a $680,000 project to retrofit the “RIM Building” in downtown Anchorage.

Included in the building retrofits are heating system upgrades, new LED lighting, a new hot water heater and installation of a new combined heat and power system that will reduce the building’s reliance on the local electric grid.

The building owner, RIM Investments LLC, is projecting an estimated 42 percent reduction in energy costs, according to an announcement of the project by Anchorage Mayor Dave Bronson.

C-PACE seems like s win-win, said Stephanie Nowers, the Mat-Su assembly member who sponsored the resolution to adopt the program there.

“This is completely voluntary (for property owners) and the financing is all private. “The only thing a municipality provides is the opportunity for businesses to take advantage of it,” she said.

Tim Bradner is publisher of the Alaska Economic Report and Alaska Legislative Digest

September jobs up 3.0 percent from September 2021

Oct. 21, 2022
No. 22-19

JUNEAU, Alaska - September employment was up 3.0 percent compared to September of 2021, an increase of 9,500 jobs. Alaska's economy continues to recover from pandemic losses but remains 13,300 below where we were in September 2019. Nearly all sectors grew over the year, although just a few have returned to pre-pandemic levels.

This summer's job numbers were bolstered by the return of cruise ships, which drove the state's strongest employment growth in related sectors. Transportation, combined with the much smaller sectors of utilities and warehousing, was up 13.6 percent (3,000 jobs) from September 2021. The leisure and hospitality sector was up 13.1 percent over the same period (4,500 jobs).

The oil and gas industry was up 500 jobs over the year, and its 7.7 percent growth is one of the largest over-the-year increases, but the industry remains 2,800 below September 2019 levels. Oil and gas employment has been slower to recover than other industries and September's job count of 7,000 is less than half the industry's 15,000 jobs in late 2014, before the pandemic or the statewide recession of 2015-2018.

Only a handful of sectors had fewer jobs than last September. State government was down 800, wholesale trade down 100 and the combined sector of private education, healthcare and social assistance was down 600 over the year. Most of the losses in that sector were in social assistance.

The state's seasonally adjusted unemployment rate was 4.4 percent in September, down two-tenths of a percentage point from August's revised rate. The comparable U.S. rate was 3.5 percent, down from 3.7 the month before.