State projects 8,500 new jobs in next two years

Posted: Friday, May 05, 2000

ANCHORAGE (AP) -- About 8,500 new jobs will be created in Alaska over the next two years, more than three-quarters of them in Anchorage and Fairbanks, according to a forecast by the state Department of Labor and Workforce Development.

That projection works out to a gain of 1.7 percent this year and 1.4 percent in 2001.

''These two years fall right into the middle of where we have been for most of the 1990s,'' said John Boucher, a state labor economist in Juneau.

Since 1991, Alaska's annual job growth has ranged from 0.6 percent in 1996 to 2.8 percent in 1994. Last year's increase was a modest 0.9 percent, labor officials said.

The vast majority of the 2000-01 jobs will be in the services sector, with healthy gains also expected in wholesale and retail trade, transportation and construction.

Job losses are anticipated in federal government employment, seafood processing, timber, and the high-paying oil industry.

The forecast was issued after Phillips Petroleum Co.'s $7 billion purchase of Arco Alaska Inc.'s assets, but before job cuts were announced at Prudhoe Bay as the field moves from two operators -- Arco and BP Amoco -- to a single operatorship under BP.

Boucher said the Labor Department doesn't have to rework its numbers because of the Prudhoe changes.

''We felt consolidation was going to happen under just about any scenario,'' he said. ''It was more a matter of timing -- when it was going to happen.''

The department is projecting a loss of about 200 oil-industry jobs over the two years in Anchorage, where Phillips and BP Amoco have said most of their cuts would be focused. Job losses in the industry would continue a decline under way for several years.

Despite fewer oil jobs, Alaska's largest city is expected to see more employment growth in 2000-01 than the state as a whole.

The forecast calls for a net increase of 3,000 jobs in Anchorage this year and 2,200 more next year. By percentage, those growth rates are 2.3 percent and 1.6 percent, respectively.

About 1,350 new jobs are expected in Fairbanks, the state's second-largest community, in the two-year period. Percentage-wise, the growth would be 2.2 percent in 2000 and 1.8 percent in 2001.

Last year, Anchorage and Fairbanks accounted for about 59 percent of the state's wage-paying jobs. But the labor officials envision nearly 80 percent of the new jobs will be in those cities.

Part of that is because those communities are the state's two big service centers.

''Services are the big growth engine, but they have been for a long time,'' said Neal Fried, a labor economist in Anchorage.

Services include health care, computer services, business support, law firms, tourism and more. Statewide 5,500 of the 8,500 new jobs are expected to show up in this category.

Accompanying the job growth will be a relatively tight labor market, according to Fried. The shortage of available workers in the state is largely because demand for labor is so strong this year in the bustling Lower 48 economy, he said.

That could translate to higher wages for local workers.

''It should be a positive (for workers),'' Fried said. ''How big, I don't know.''

The jobs forecast calls for 850 new positions in Southeast Alaska over the two years, with annual growth rates of 1.3 percent and 1.1 percent. Increases in construction and services will be offset by losses in the timber and government sectors, the Labor Department said.


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