State of The State-AK

January 17th, 2018

Alaska Department of Labor and Workforce Development, Research Section, Neal Fried, Economist

Anchorage’s Lost Jobs Again In 2017

80,000

90,000

100,000

110,000

120,000

130,000

140,000

150,000

160,000

Number of Jobs

Oil Revenue

PartyAlaska’s “Great Recession”

1989-2008, 20 year of growth ends

AK oil recession-2

years of losses

1993 “full recovery” – record annual count begins

Lost 900 jobs in 2009

*preliminary

0.1%

1.8%

2.2%

0.1%

-0.3%

0.5%

-1.7%

-1.4%

2010 2011 2012 2013 2015 2016 2017

Anchorage’s Workforce Got Smaller For Second Year In A Row

-2,200

-600

-400

-300

-300

-200

-100

-100

-100

800

Jobs Lost And Gained In Anchorage In 2017*

Total

Prof. Business Servs.

Construction

Oil and Gas

State gov.

Federal gov.

Leisure & Hosp.

Health Care

Local gov.

*preliminary

Retail

Unemployment Remains Relatively Low In Anchorage

0

2

4

6

8

10

12

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

U.S.

3.9%Anchorage

5.8%

Unemployment rate, percent

12,843

13,23613,485 13,434

12,517 12,468 12,325 12,378 12,33011,964

11,741 11,76412,106 12,035 11,898

10,816

10,36910,150

9,946 9,8009,652 9,552 9,443

9,693 9,5639,752 9,645

9,2768,923 8,931 9,004 9,029

8,874

Jan2015

Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan2016

Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan2017

Feb Mar Apr May Jun July Aug Sep

Oil Industry Jobs Drop From Record HighPrudhoe Bay Employment, 2015 To 2017

historic peak employment

lowest level since 2007

$2.9

$2.1 $2.1

$2.9

$3.7

$2.1$2.2

$1.5$1.6

$1.4

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Less Money For ConstructionState of Alaska's capital budgets, $billions

State of Alaska, Alaska Division of Legislative Finance

Percent of 2013 capital budget state financed,

75%

Percent of 2018 capital budget state

financed 17%

$20

$30

$40

$50

$60

$70

$80

$90

$100

$110

$120

Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov

Good News Developing

2014 2015 2016 2017

Price of a barrel of oil, ANS

The largest onshore oil discovery in America

for at least 30 years just happened in Alaska

Drilling In The US: Oil discovery In Alaska

Largest Found In 30 Years—could flow as

early as 2021

BY JULIANA ROSE

PIGNATARO @JULIE_PIGNATARO ON 03/09/17 AT

4:03 PM

Alaska gas line agency signs

agreement with Chinese oil

company, financial institutions

• Author: Nathaniel Herz, Alex DeMarban

• Updated: 8 hours ago

• Published 19 hours

Oil production up for second year in a row

By:

Elwood Brehmer

Alaska Journal of Commerce

Post date:

Fri, 04/14/2017 - 4:38pm

ConocoPhillips Alaska plans largest

exploration season in 15 years

Anchorage Uniformed Military Numbers Remain Stable

11,590 11,942 12,11312,688 12,787 12,699

10,967

12,29511,643

10,503 10,515

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

$22.3

$18.3$19.6

$21.3$22.7 $23.2

$25.2$26.2

$25.0$25.7

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*

A Good Sign For Tourism—We Dug A Bit More Out of Their Pockets In 2017

Room taxes collected in Anchorage, $millions

Source: Municipality of Anchorage

A Little Better Than Last Year But Remains At Near Historical Lows

1,372

777

528 565481 461

532 526

768 761

341460

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Number of residential building permits issued in Anchorage

Source: Municipality of Anchorage

Foreclosures, So Far There Is Little Sign Of Much Change

0

200

400

600

800

1000

1200

1980 1985 1990 1995 2000 2005 2010 2017

Foreclosures In Anchorage

Source: Alaska Department of

Natural Resources

A Pretty Attractive Income Picture

Ranking State Median Household Income-2016

Anchorage $80,862

Mat-Su $73,908

1 Maryland $78,945

2 Alaska $76,440

3 New Jersey $76,126

4 Massachusetts $75,297

5 Hawaii $74,551

U.S. $57,617 Source: U.S Census

Anchorage’s Per Capita Advantage Compared To The Nation’s

100

105

110

115

120

125

130

135

140

1990 1995 2000 2005 2010 2016

Anchorage’s per capita income as a percent of the U.S.

Anchorage’s Population Fell Slightly In 2017-Lost Half Of A Percent

293,033 295,719 298,334 300,880 300,197 298,799 298,937 297,483

2010 2011 2012 2013 2014 2015 2016 2017The details. In 2017, there were 4,273 births minus 1768 deaths, plus net

migration of -3,959 that leads to a population loss of 1,454.

More Folks Have Been Leaving Anchorage Than Moving Here For A While

-631 -500 -612

-3,881

-4,401

-2,730

-3,959

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17

Net-migration--Anchorage

3.0%

7.0%

-2.0%

-14.0%

13.0%

17.0%

-28.0%

64.0%

8.0%

0-4

5-19

30-39

40-49

50-59

65 plus

Total Population

Ten Year Anchorage Population Projections, 2015-2025(what does this mean to you?)

19,721

18,345

-8,911

6,304

5,789

-6,809

-3,358

4,121

613

20-29

20-64

My Anchorage Forecast Record And What Really Happened

-0.6%

1.8%

2.2%

0.1%

-0.3%

0.5%

-1.7%

-1.4%

-0.4%

0.4%0.6%

1.2%

0.2%

-0.5%

-0.9%

-2.0%

2009 2011 2012 2013 2015 2016 2017*

Reality My Forecast

2014

*preliminary

0.1%

1.8%

2.2%

0.1%

-0.3%

0.5%

-1.7%-1.4%

-0.7%

2010 2011 2012 2013 2015 2016 2017 2018

I Forecast Another Year Of Employment Losses In Anchorage-but Tapering

Forecast

100

2,700

3,400

100

-400

800

-2,700

-2,200

-1,000

2010 2011 2012 2013 2015 2016 2017 2018

Here It Is In Actual Numbers-Employment Losses In Anchorage

Forecast2014

-1,000

-300

-300

-300

-200

-200

-100

-100

0

600

Jobs Forecasted To Be Lost And Gained In Anchorage In 2018

Total

PBS

Construction

Oil and Gas

Federal gov.

Leisure & Hosp.

Health Care

Local gov.

Retail

State gov.

67%

82%

89%90%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

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Percent of Time States were Adding Jobs, 1961-2016

Recessions Are Typically Short

Less than 1 year, 17%

1 to 2 years, 58%

2 to 3 years, 18%

3 to 4 years,

7%

But Recoveries Take Longer

Less than 2 years, 26%

2 to 4 years, 27%

4 to 6 years, 20%

6 to 9 years, 20%

10+ years, 7%

1,000

1,200

1,400

1,600

1,800

2,000

2012 2013 2014 2015 2016 2017

Employment at snack and nonalcoholic beverage bars--average monthly employment

AK's Coffee Industry Continues To Perk

0

5

10

15

20

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

No Recession For Our BreweriesNumber of breweries in Alaska

$81,100

$145,800$107,500

$128,000

$220,200

$272,000$272,600

$512,500

$577,901

$694,364$723,757

$953,591

$872,197

Nov Dec Jan Feb Mar May Apr Jun Jul Aug Sep Oct Nov

Monthly marijuana taxes collected by State of AK

Source: AK Department of Revenue FY

Another “Budding Growth” Industry —But Revenues Not

Going to Get “High” Enough To Bail Out the Economy

2016 2017

Anchorage Pickup Index—Following Employment?

20,000

30,000

40,000

50,000

60,000

70,000

98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 16

Number of pick-up registrations in Anchorage

13,232 snow machines in 2016--peaked in 2007 at 16,878