Understanding Anchorage’s economy: Fewer people, flat job scene, the Hilcorp effect

By
Suzanne Downing
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20
359

Anchorage has shed 6,000 jobs since 2015, with 300 of those disappearing last year.

At the same time, the city’s unemployment rate for 2019 was 5.1%, the lowest in nearly 20 years.

Those contradictory numbers make sense when one realizes that the labor force has been moving out of Anchorage, in search of better opportunity in the Lower 48, where the economy is roaring. And the unemployment rate only accounts for those who are actively looking for work.

Since 2015, the Anchorage workforce has declined by about 10,000 people (6.3%) to settle at 149,000, close to where it was in 2004.

These are a few of the conclusions of the annual Anchorage Economic Development Council report, offered today during the AEDC’s annual forecast luncheon at the Dena’ina Center. The report, produced by the McDowell Group, is rich in data that covers nearly all segments of the city’s economy. The annual luncheon is popular with civic leaders and this year was no exception — it sold out.

The population of Alaska’s largest city dropped by 2,600 last year, continuing a trend that started with beginning of the recession in 2015. Anchorage is now home to an estimated 291,845 people in July 2019.

The city has lost 3.1 percent of its population in seven years.

The report shows that 370 government jobs, mostly with the University of Alaska Anchorage, were shedded, a 1.3 percent decrease in government employment. That brings overall government employment in Anchorage back to the level it was in 1998, said Bill Popp, president of AEDC.

About 400 retail jobs left Anchorage last year, with the exits of chain stores like Nordstrom and Pier 1.

On the bright side, oil and gas, construction, and professional services stopped the downward job trend.

AEDC expects Anchorage to gain about 100 jobs in 2020. The health care, visitor industry, construction, professional services, and federal (census-related) government work will contribute jobs, while retail and other government work will shrink, and oil and gas jobs may dip as BP Alaska exits and Hilcorp makes those acquired operations leaner.

Although the report doesn’t delve into the cost of city government for the 3.1 percent fewer people, the municipal budget approved in the November of 2019 is $540 million, a whopping 14.5 percent more than the budget approved in 2014 under former Mayor Dan Sullivan.

The entire AEDC report can be read at this link.

20 COMMENTS

  1. Editor: I’m checking my conjugation references this morning, and am wondering about the use of “shedded” vs. “shed”. MRA grammar is generally impeccable, but I’m not quite sure about the use of the inflected form of the verb in this case…

    • Whidbey- Maybe it should have been “shredded” jobs. Or would that be “shred” jobs? Good catch. – sd

  3. Essentially Berkowitz’s tenure as mayor has been a complete failure if you care about any metric beside being in power and getting your supporters money.

  4. The real unemployment rate is much higher than 5.1 percent when you take into account the homeless population who are no longer looking for work.
    As BP pulls out of AK we should turn their highrise into a low income housing facility and job training center.

      • Wonder what percentage of Anchorage’s bums were kicked out of other places and dumped in Anchorage because locals didn’t want to foot the bill.

    • Do you have proof showing the homeless actually looked for work? How will the taxpayer pay for the BP building? How much will the transformation from an office building to a homeless housing facility cost? How will the taxpayer organize, and fund a job center? Please provide solutions.

  5. 1. What is your reference data to support the homeless people actually looked for work?
    2. At what cost to the taxpayer would we be looking at to purchase the BP building, retro fit it to suit the homeless housing issue and to become ADA acceptable?
    3. What would be the cost associated with maintaining the building, cleaning the rooms, and creating and operating a job training center?
    4. How would the taxpayer funding required be financed?

    This is either a tongue in cheek recommendation, or one from someone who doesn’t understand the deep dark side of banking responsible people are familiar with: They’re called deposits.

    Respectfully.

    • Comrade Phil, you’re bordering on counterrevolutionary thought.
      .
      Data is whatever our leaders choose to share.
      .
      Purchase cost is immaterial; Anchorage’s easily corruptible mail-in vote system assures no bond or tax will be inadvertently left behind; remember how APD was moved downtown.
      .
      Maintenance cost is immaterial; the idea is to provide physical addresses to bums, so they can be registered to vote, and helped to vote correctly, thus assuring continuity of our revered leadership.
      .
      Taxpayer funding is easy; Anchorage taxpayers proved their malleability when they submitted to their fuel tax and plastic-ban; when they quietly accepted the need to choose between law enforcement and snow removal.
      .
      In other, taxpayers can, and should be forced to pay what their leaders require for the orderly governance of the Holy City of Anchorage.
      ,
      Good deal, yes?

  6. Loss of population and jobs but yet the Assembly increases the budget something dosen’t jive. They should be cutting the budget with less people living here.

  7. The RCA files says 120-150 persons are expected to be attrited ( i.e. shed) from the ML&P/CEA merger over the course of 5 years.

  8. Um, except Hilcorp. Many, if not most, of the employees were part of the deal. Not sure about the BP Building itself, but it seems like that would be included.

    • Yo Frediculous… what does “Um, except Hilcorp” mean? And what does it mean when you say “Many, if not most, of the employees were part of the deal”? Does that mean you think that many (or most) that worked at BP would now work at Hilcorp?

      If that’s what you meant it’s patently untrue. A more accurate estimate would be that about 1/3 of the legacy BP staff are likely to be retained and the bldg goes to Hilcorp as part of the deal. BP tried to peddle the bldg cheap long ago as being in the RE business was not within their core competency.

      Talk to some of the staff at BP. You’ll find that your assumption is a tad optimistic; they’re gone soon and many have already taken the buy out.

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