Business leaders lukewarm on economy

Statewide survey results praise quality of life, pan lack of long-range fiscal plan

Posted: Friday, January 12, 2001

ANCHORAGE -- Business leaders around the state gave Alaska's economy mixed reviews in a recent survey.

Alaska business leaders are guardedly optimistic about the state's economy over the next three to five years but are worried about long-term problems, such as creating enough good jobs to keep young people from moving out of state, and educating enough skilled workers.

Results of an informal Internet-based survey of members of 13 business and industry organizations were released Wednesday. About half of the 430 respondents were from Anchorage, which has about half the state's population, with the remainder from other communities, said Sally Suddock, executive director of the Alaska High-Tech Business Council, which coordinated the survey.

"It was a mixed report card," said Jamie Kenworthy, executive director of the Alaska Science and Technology Foundation, which helped with the survey. "Slightly more than half of respondents felt the economy is doing good or excellent, and just under half felt the economy was doing average or poor."

There is a perception that things will get a little better, Kenworthy said. A few more people feel the economy will improve in three to five years, and fewer people think things will remain average or get worse.

"The good news is that we scored really high on quality of life. People like to live here. The question is whether we can generate enough jobs so that people will stay here," Kenworthy said.

Suddock said the survey started out as a poll of Alaska-based technology companies on problems their managers are concerned with. It was then decided to include the state's general business and industrial community, she said.

Resource-related organizations like the Resource Development Council, Alaska Support Industry Alliance and Alaska Miners Association took part in the survey, but most responses came from general business members of local chambers of commerce and the Alaska State Chamber of Commerce, Suddock said.

Kenworthy said the survey was to be informal and subjective and was intended to get perpections on structural problems in the economy.

Almost 80 percent of the respondents expressed concern with poor to average growth in personal income in Alaska, compared with other states. "The concern over lack of personal asset growth in Alaska was clearly picked up in the survey," Kenworthy said. "That's a hidden tax on Alaskans imposed by a slow-growth economy."

Ninety-five percent rated creation of good jobs to stop the out-migration of young people as very important or important, but about half rated Alaska's ability to create good jobs as poor. Seventy percent of those responding rated the state's education system, including K-12, technical training and higher education as average or poor. Thirty-six percent of respondents felt the state's ability to hold skilled workers is poor, and 47 percent rated it as average.

Another major concern of business leaders is that the state has no long-range fiscal plan or a state and local economic development plan.

A long-range fiscal plan would reduce the state government's dependence on one industry, oil and gas. A development "road map is a mixture of projects and investments we need to rebuild the state's economy," Kenworthy said.

Bob Stiles, president of the Resource Development Council in Anchorage, said he was surprised that most respondents felt the regulatory and permitting environment in Alaska was fairly positive.

"It's a perception I happen to agree with, but it's not one you would expect to hear from the business community."

Kenworthy said the next goal for the coalition of business groups is to put the survey out to the general public.

"We need to gut-test our responses to that from the public."

Following that, the group may decide on a series of local or regional economic summits to thrash out ideas to improve the economy, or some other course of action.

"Ninety-seven percent of the respondents agree that the public and private sector should work together," in developing an economic development strategy for the state," Kenworthy said.

"When you get that kind of mandate, it's time to end the discussion of how to split the pie between government and the private sector and focus on how to make the pie grow. Our evidence is that the pie isn't growing," he said.

Tim Bradner is a reporter for the Alaska Journal of Commerce.

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