Economic outlook shows declining consumer confidence, expected job losses in Anchorage
Consumer confidence in Anchorage is at an all-time low, according to the Anchorage Economic Development Corporation’s (AEDC) three-year economic outlook.
AEDC randomly surveyed 350 households in Anchorage which rated their optimism on a scale of 1 to 100. In the second quarter, for the first time since AEDC started the survey in 2011, consumer optimism dropped below 50 to a score of 48.2.
People were polled on three factors: Confidence in the local economy, confidence in their personal finances and expectations for the future.
AEDC President Bill Popp said the first two categories held steady at 50.8 and 65.7, respectively. Future expectations dropped to 38.2, down nearly 14 points from the year before.
Popp said that’s likely due to Alaska’s questionable financial future and the lack of a state budget.
“When you’ve got a state government that’s at risk of basically folding, in the minds of some, and a three billion dollar budget shortfall and no plan to take us forward into the future, it leaves consumers wondering how we’re going to get out of this,” said Popp.
AEDC also predicts steady job losses over the next few years. Popp said 2016 is forecasted to lose 1,600 jobs, mostly in the oil and gas and construction industries. Overall that’s a one-percent decline, while 2017 is expected to see similar losses.
Popp said Anchorage is coming off a 27-year gain in jobs, and an all-time high of 156,066 jobs in 2015, so any decline is noticeable.
“They are modest declines but they’re definitely going to be painful,” said Popp. “We see this as more of a pinch to our economy than a punch. It’s going to hurt and it’s going to leave a mark but it’s not going to be the knock-out some folks think it might be.”
Some bright spots in the economic outlook include tourism and an increase in passengers and cargo through the Anchorage International Airport.
Popp said while the outlook might be grim, it’s nowhere near the collapse Anchorage saw during the recession in the 1980s, when the city lost about 10 percent of its workforce. That’s compared to the estimated two percent it’s expected to lose by 2019.
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