The Anchorage Economic Development Corporation presented its report today along with predictions for Anchorage’s economy. From the doubling of the Permanent Fund Dividend to jobs gained and lost, locals got a hopeful look into the next three years.
Economists are expecting this year’s PFD to double, and to possibly increase up to $3,000 in coming years. Market watchers say that since the losses of 2009 are no longer part of the equation for deciding the amount of the dividend, they’re expecting a lot more money to go back in to Alaskan’s pockets.
That’s good news for Anchorage’s retail sector, which saw major growth in 2013 and modest growth so far this year after a decade of staying flat.
But the report highlighted some troubling trends as well: the pool of qualified applicants for jobs in Anchorage is shrinking.
AEDC says that unemployment could down to 4.4 percent by the fall. In fact, almost every sector in the local economy gained jobs this year, except the public sector.
“We’re seeing good, steady growth in the private sector,” said Bill Popp, President and CEO of AEDC. “But when you look at the government side of the equation, we’re seeing some significant losses.”
About half of those jobs are federal, and around one third of Anchorage’s economy is based on federal spending.
“It’s kind of across the board,” Popp said. “It’s all agencies are being asked to cut, and they are doing it through not replacing positions. It’s not a full scale layoff, it’s just been a slow, steady decline in federal employment.”
The other half of those losses are related to state budget constraints, and are almost entirely from eliminated teaching positions within the Anchorage School District. Government jobs declined by 900 in 2013, and so far this year, 600 jobs have been lost.
But AEDC says that despite the areas of concern, Anchorage’s economy is on track for steady gains.
“We've been blessed here in Alaska, and in Anchorage in particular, with just moderate growth,” Popp said. “We've not seen the big boom and bust that we saw back in the 80s.”
AEDC also noted that consumer confidence is at an all time high.
“They’re buying stuff, right? Which is a good thing,” Popp said. “They’re borrowing money, and they feel like they’re going to be able to repay it.”
The tourism industry is also having a record year, and Anchorage’s personal income is expected to continue to increase.
AEDC says that 2014 could be a turning point in Anchorage’s economy, and that the military and tourism, along with the city’s role as a service and supply center, will continue to be important economic drivers.