Employment Forecast to 2008.

• Author: HADLAND, JEFF

Alaska Department of Labor and Work Force Development

Despite short-term setbacks in natural resource prices, Alaska's strategic location, oil wealth and expanding service economy will provide thousands of new jobs for Alaskans over the next 10 years.

Employment growth in Alaska is expected to increase at an annual rate of 1.6 percent per year over the next 10 years, resulting in 19,000 new jobs by 2003 and about 46,000 new jobs by 2008. This rate of growth is well below the annual growth rate of 2.5 percent from 1988 to 1998, but greater than that anticipated during the next two years.

Employment growth will be focused primarily in the service, trade and transportation industry sectors. The new jobs will be created at a faster pace outside the Anchorage area and will likely pay less than many of the jobs that have been lost in declining industries.

The growth will be driven by a growing population, Alaska's new industries, increased tourism, and an economy that provides more in-state services. This growth in the number of new jobs, coupled with normal turnover, will result in a wide variety of employment opportunities for the unemployed, underemployed and recent graduates of Alaska schools. Overall, employment growth is expected to continue during the next decade.

The resilience of the Alaska economy has been surprising. Total employment has increased each and every year this decade despite oil prices reaching historically low levels, oil industry layoffs, state and local budget cutbacks, closure of pulp mills and sawmills in Southeast Alaska, declines in fishing harvests, and reduced median household income! Employment grew by 2.5 percent in 1998 alone.

How has employment growth been possible in the face of all the bad news in Alaska's resource extraction and processing industries? Many factors have contributed. Most importantly, the fast-paced growth of several emerging Alaska industry sectors, coupled with the continuing diversification of the economy and stable government spending, provided a strength that has allowed Alaska to weather the recent economic storm.

Industries leading the expansion include Alaska's air cargo and visitor industry sectors, telecommunications, health services and the retail sector. Also, the number of nonresident workers in Alaska has declined, reducing the leakage of income outside Alaska since workers spend most of their money where they live. And the ever-increasing Permanent Fund Dividend check has provided a huge boost in consumer spending, representing a 13th monthly paycheck for most families.

Alaska's population has reached a critical mass where retail and service opportunities can be met locally, rather than Outside. Retail trade...