Alaska employment, boosted by summer tourism, begins gradual seasonal decline

Alaska employment began its gradual seasonal decline in September after a healthy summer of strong tourism activity, according to preliminary data published by the Alaska Department of Labor and Workforce Development.

Wage and salary jobs, not including the self-employed, totaled 336,000 in September, 7,000 jobs down from 347,000 in August.

Compared with September a year earlier, however, total employment was 2 percent up, reflecting continued but gradual improvement in the state’s economy overall from the job declines caused by the COVID-19 pandemic.

The September 2 percent increase year-over-year was up compared with most of the 2023 summer months, which showed only marginal increases from the same months of 2022. August, for example, was 1.4 percent up from August 2022.

Compared with the nation, however, Alaska’s economy is showing tepid performance. Tourism in the state is up but many other industries including several with high-wage jobs, like petroleum and construction, are basically flat-lined or showing only slow growth, although that will change as work picks up on new oil project.

Part of the current slow job growth is due to ongoing labor shortages. Jobs are posted but not enough people are applying for them. There are twice as many jobs being advertised compared with people seeking jobs, several economists have said. If more of the posted jobs could be filled the employment numbers would look better.

Still, what’s dragging on Alaska’s economy overall is the continued out-migration of working-age adults to other states, which creates a smaller pool of available labor here.

The September jobs data shows Alaska as at least stable, however. The effects of the pandemic are behind us. In September, leisure and hospitality, a category loosely illustrating the summer visitor season, was up 3.6 percent, of 1,400 people employed, from September 2022.

August workers in the visitor industry were up 2,000, a 4.8 percent increase year-over-year. Other industries showed growth in September.

Health care was up 1,400 or 3.6 percent compared with the same month of 2022, mainly due to hiring by hospitals, state labor officials said. Health care jobs gained 900 in August, year-over-year.

Government jobs were up 1,000 with most of the gain in federal agencies. State employment was down slightly, but it was more than offset by stronger increases in local government.

Oil and gas, construction and professional and business service employment all showed gains in September compared with September, 2002. Oil and gas workers increased by 200 or 2.8 percent; construction by 300 or 1.7 percent, but professional and business service jobs were up by 700, or 2.5 percent.

Professional and business service includes engineers and consultants and is linked to growth the state’s natural resource industries. It is a field that is closely watched because these workers are employed typically in projects in planning and development.

When there is an increase in professional and business services, as there is now, it is usually followed by increases in construction and, finally, production jobs as projects are finished and begin operations.

The state’s big wholesale, retail and transportation sectors showed modest gains in September compared with the same month of 2022. Wholesale trade was up 1.6 percent; retail was up 0.9 percent, and transportation, warehousing and utility jobs were up 1.6 percent.

As cold weather sets in work on several new North Slope projects will pick up and that will increase the number of petroleum, construction and transportation workers. Jobs in engineering and consulting specialties like environmental permitting will increase or remain stable as work ramps up on Pikka, a major new North Slope oil project.

If ConocoPhillips gets the go-ahead from an Alaska federal court to proceed on Willow, another substantial oil project, that will only add to the increase in jobs.

Both Pikka and Willow are multi-year projects, so the employment effects will be spread over several years, Pikka until 2026 in its initial phase and Willow until 2029, when it is due to begin production.