Alaska continues to post gradual economic growth

Posted: Thursday, December 13, 2001

ANCHORAGE (AP) -- While the Lower 48 has sunk into a recession, the Alaska economy continues to grow, albeit at a slow pace.

State labor economist Neal Fried told the Anchorage Chamber of Commerce Monday that job growth should be about 1 percent, up to 3,000 jobs, down from the 2 percent Alaska experienced this year.

Alaska is in its 14th year of growth, its second-longest run in state history, Fried said. The annual growth, however, has been almost flat, hovering mostly in the 1 percent to 2.5 percent range during the past decade.

''This is one of the most predictable economies to forecast this last decade,'' Fried said. ''You probably could have taken a ruler and been pretty close.''

This year and last saw higher growth than in 1999, in part because of a couple of big oil projects, like BP's Northstar development, which created about 400 to 500 construction jobs. Also, a steady upward trend in the service, retail and construction sectors has helped, he said.

The state gained at least 4,700 jobs in 2001.

Optimism has fueled job growth since late last year, despite the slowing U.S. economy. As the Lower 48's booming tech sector crumbled, proposals for two major oil and gas developments began to fire up Alaskans.

The combination of a Republican administration and high oil prices fueled a new push for drilling in the Arctic National Wildlife Refuge, which is closed to oil development but is considered the nation's best onshore prospect for a big oil strike.

Oil producers dusted off a long-standing proposal to tap North America's largest natural gas reserves on the North Slope, a multibillion-dollar project if it happens.

From builders to telecom companies, Alaska businesses began feeling another boom in the works. But optimism started to wane in recent months.

ANWR drilling remains up in the air, awaiting a Senate vote likely to happen early next year.

The oil companies have preliminarily said a North Slope gas project -- an estimated $15 billion to $20 billion proposition that would entail building a gas pipeline to the Lower 48 -- would not give them enough profits to undertake.

''There is optimism still out there, but it is just more cautious,'' Fried said.

For next year, the Alaska economy should continue to chug along, just not as fast. The state is expected to add about 2,600 to 3,000 jobs, he said.

Here is Fried's growth outlook for Alaska's big industries:

Oil jobs should stay level or shrink.

Mining, manufacturing, transportation and telecom job levels should remain about the same.

Retail and services, construction and health care will likely see more jobs.

Tourism is in question, given the downturn in the visitor industry because of the Lower 48 recession and Sept. 11 terrorist attacks.

Government and military, a key sector that funnels millions of federal dollars into the economy, should do about the same or slightly improve over this year.

Subscribe to Peninsula Clarion

Trending this week:


© 2018. All Rights Reserved. | Contact Us