Kenai Peninsula economy shows strength and diversity

KENAI (AP) -- A state labor researcher says the Kenai Peninsula's economy is diverse and reasonably strong -- and better in many ways than other economies around the state, despite only a 1.8 percent economic growth in the 1990s.

Brigitta Windisch-Cole presented her optimistic report at the Kenai Chamber of Commerce luncheon Wednesday.

The peninsula has always had a faster rate of growth than the rest of the state, according to Windisch-Cole, a researcher with Alaska Department of Labor and Workforce Development. The past decade has been mixed, however, with oil and gas employment declining by nearly ten percent. Manufacturing fell by 25 percent.

The loss of almost two percent of peninsula jobs in 1999 over the previous year was caused by layoffs at the Unocal fertilizer plant, Southcentral Air going bust and the Icicle Seafoods plant fire in Homer.

Retail showed the greatest growth of all sectors in the last decade -- a job increase of 57.7 percent. It was closely followed by the financial, insurance and real estate industries with 39.5 percent, and construction at 30.8 percent. The service industry and government employment increased by roughly 24 percent each.

Part of the increase in government jobs is attributable to a change in accounting procedures by the state, Windisch-Cole said.

There is a huge disparity in wages between the oil and gas industry, which is losing jobs, and the service and retail industries, which account for most of the new jobs created on the peninsula.

Figures show annual oil and gas wages in 1999 averaged $60,485, while service and retail averaged $18,000.

Windisch-Cole pointed out that the service and retail wage for a full-time, year-round employee would be a little higher than the average, since seasonal and part-time jobs are calculated with full-time jobs, slightly skewing the figures.

The service and retail industries account for 40 percent of peninsula jobs, she added.

In 1999, the peninsula work force earned $498.6 million, with an average wage of $30,091.