Government accounts for almost 25 percent of jobs in borough

Posted: Tuesday, February 25, 2003

Though economic support is more of a side effect than the main purpose of government, it is a side effect that has a significant impact on federal, state and local economies.

In 2001, the borough school district was the top employer with 1,426 people, followed by the state of Alaska with 856 people (not counting University of Alaska employees), and the federal government with 414 people.

Perhaps the most significant way in which all levels of government contribute to the economies of the Kenai Peninsula Borough and its cities is through employment and wages.

In 2001, as well as previous years, government was the top employer on the peninsula. In 2001, the borough school district was the top employer with 1,426 people, followed by the state of Alaska with 856 people (not counting Univer-sity of Alaska employees), and the federal government with 414 people. The borough minus the school district ranked seventh, with 328 employees.

Statistics from 2000 show federal, state and local government accounted for almost 25 percent of the total employment in the borough. The borough, including the school district, accounted for 16.6 percent of that employment, while state government accounted for 6 percent and federal government 2.6 percent.

"That's just really a pretty huge sector in the economy," said Linda Snow, city manager for Kenai. "It's larger than the employment from any other sector."

Each government employee gets a paycheck, most of which is pumped into the the local economy through purchases and other means. In 2000, the federal government paid $21.6 million to its employees in the borough, the state paid $37.9 million and the borough paid $95.5 million, according to Jeanne Camp, an economic analyst with the borough.

City government likewise contributes to the economy through their employees.

The city of Kenai, for instance, employed an average of 112 full- and part-time workers in 2001, said Snow. According to Finance Director Larry Semmens, in the fiscal year ending in June 2002, Kenai paid almost $5 million in wages to its workers.

The city of Soldotna currently employs 50 full-time and three regular part-time people, which does not include temporary workers at the sports center, said City Clerk Pat Burdick.

Burdick said the city budgeted $2,607,556 in wages for the fiscal year 2002.

The city of Seward employs an average of 75 people a year, and the city of Homer averages about 105 full- and part-time employees a year.

Although government employees, whether federal, state or local, are not the top wage earners in the country, their wages are above the national average.

That, combined with that fact that government is responsible for so many jobs on the peninsula, would mean a cutback in government jobs would have an impact on the economy.

"Obviously a loss of 10 jobs in government would have a greater effect than the loss of 10 jobs in service and retail -- or 100 or 1,000 jobs," Camp said.

Employment is certainly a significant way in which government contributes to the economy, but it is not the only way. There are other less obvious and less direct means of contribution, as well.

For instance, federal, state and local governments routinely award grants to fund programs and projects that operate in the borough. Borough residents also receive a variety of monetary benefits from the government, including Social Security and welfare.

Local governments tend to purchase equipment and supplies locally, as well.

"The borough purchases a lot of equipment and supplies and I would guess that the federal and state offices here do, too," Camp said. " ... With that many employees, we go through a lot of supplies, whether it's office supplies or cleaning supplies."

Government capital projects, like building projects, also contribute to the economy because they provide jobs and income for contractors, architects and other service providers.

"Capital projects, small and large, are just a very important part of the economy," Snow said.

Another way government contributes to the economy is through the creation and maintenance of the infrastructure necessary for other sectors of the economy to operate.

like roads, water and sewer facilities and public safety.

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