Mat-Su to outpace Anchorage in population, job growth, state says

Another 5,300 jobs are expected to be added in Alaska in 2025, according to the latest state Department of Labor and Workforce Development employment forecast, and while the data for the Mat-Su region isn’t broken out the area is expected to see continued fast pace of employment and population growth.

Population, which drives employment, is expected increase by 28% in Mat-Su, or 32,300, between 2023 and 2025, while Anchorage’s population will decline by 29,500, or about 10 percent, according to state demographers.

Statewide, most industries have recovered from the pandemic, with employment now above 2019, the last pre-pandemic year.

Total wage and salary jobs are up 2.9% over 2019 while private sector jobs are up 3.7%, according to the forecast.

Construction, health care, transportation and the oil and gas industry are leading the growth according to the estimates, published in the January edition of Trends, the state labor department’s monthly report.

Employment growth in slowing in the U.S. but Alaska has pulled ahead of the nation in adding jobs in both 2023 and 2024, state labor economist Kerinne Wiebold, said in the Trends article on employment growth.

Oil and gas, construction and health care are all important for Mat-Su valley residents. A considerable number of workers in the region commute to oil industry jobs in Anchorage or on the North Slope and health care is an important industry for the area, and is centered on the Mat-Su Regional Medical Center complex on the Parks Highway between Palmer and Wasilla.

North Slope oil work and continued growth in the tourism industry are positives for the state, Wiebold wrote, but there are challenges too, including labor shortages and tumult in the state’s seafood industry, she wrote.

“Workers have more opportunities than usual to look for other, higher-paying jobs and many businesses have increased wages to attract and keep them amid the higher turnover,” Wiebold wrote.

The worker shortage is caused by several factors including continued out-migration of working-age adults, who typically have families, along with demographic trends that include an aging population, more people retiring, and a falling birthrate that translates to fewer children in schools and, ultimately, the workforce.

The workforce gaps are likely to be filled partly by nonresidents. “In 2023, the most recent year for which data is available, Alaska imported proportionately more labor than we had in 20-plus years,” Wiebold wrote. “That trend is likely to continue as labor remains scarce amid strong short-term job growth.”

However, it’s more difficult to attract out-of-state workers outside of industries like oil and gas and construction, which can afford to pay higher wages. For the state’s general business community, wages paid are only slightl higher or about on par against wages paid in U.S. western states that Alaska usually draws labor from.

In the 1970s workers in Anchorage were typically paid at 90 percent more than the average U.S. worker. But that premium has now dropped to about 10 percent. This may not be enough to entice people to pack up and move to Alaska.

While oil and gas projects are driving brisk growth in jobs in those industries, the hard-hit seafood industry is struggling, and losing jobs. Global trends aggravated by Russia’s war in Ukraine are dragging down sales and prices for Alaska fish harvesters and processors. This is having major adverse affects in coastal communities.

In late 2023 and 2024 major seafood processors Trident and OBI announced plant closures and sales of plants amid historically low prices and flooded markets. In April, state labor economists estimated that Alaska’s seafood processing workforce would shrink 15%.