AEDC projects another year of recession based on uncertainty from Juneau
“Anchorage, right now, oddly enough, is an island of stability in a sea of chaos and tumult,” said Anchorage Mayor Ethan Berkowitz Wednesday.
The mayor is one of several speakers at the Anchorage Economic Development Corporation’s three-year outlook luncheon taking an optimistic approach to the current recession.
AEDC reports Anchorage saw a total of 3,000 jobs lost in 2016 and 1,600 so far this year. They’re projecting 2,100 total jobs lost in 2017 and 700 more in 2018.
“Unfortunately, due to the lack of a solution to the state’s fiscal crisis being developed by the legislator and the governor, we are now projecting a third year of recession in 2018,” said Bill Popp, president and CEO of AEDC.
He estimates by the end of the year, Anchorage will have experienced a 3 percent job loss over two years, compared to a 15 percent job loss in the 1980s.
“It’s a good, sharp pinch, and it’s definitely leaving a mark on the economy, but it’s definitely not the head blow we took in the 1980s,” he said.
AEDC is projecting employment will stabilize in 2019 and grow by 700 jobs in 2020.
Perhaps one of the most troubling numbers presented during the business luncheon comes from AEDC’s consumer optimism survey. It shows a “crisis in confidence,” according to Popp, sitting at 47.5 percent, the lowest it’s been since AEDC has measured it.
“If consumers lose their optimism, they will stop spending, and they will make a bad situation worse,” he said.
While consumers maintained 60 percent confidence in their personal finances, optimism dropped to 40.6 percent when they were asked about their expectations of Anchorage’s future.
AEDC projects a small decline in population, noting that people are leaving Anchorage, but “natural increase” (more births than deaths) has offset the outflow.
Governor Bill Walker took to the stage briefly and told guests he’s hopeful they’ll make progress in Juneau soon.
“I go back to Juneau tonight and I’m hopeful for a capital budget at the end of the week, and I think that’s gonna happen,” Gov. Walker said.
While the oil industry has been one of the hardest hit, AEDC presented data showing job losses there appear to be leveling off this year.
Private sector service jobs that depend on oil and state spendings; like architects, engineers and project managers, are now seeing sharper downward trends, while healthcare remains the fastest growing sector — tourism is doing well and air cargo remains steady.
The bottom line: While there is optimism the economy will improve, the report indicates it will likely get worse before it gets better.
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