Alaska’s job recovery is expected to continue this year

Seward's railroad terminal
Seward’s Alaska Railroad terminal. Jobs in sectors like tourism have been improving, slowly, since 2020. (Sabine Poux/KDLL)

Alaska’s job market will continue on a path of recovery this year, though it’s still a long way from where it was before the pandemic.

That’s according to the 2023 job forecast from the state Department of Labor. Karinne Wiebold is an economist with the state and authored the report in the department’s monthly magazine.

“Pretty much every industry is forecasted to grow,” she said. “But a lot of them are just returning to pre-pandemic levels. So this is just kind of a return to normalcy.”

The state’s job market took a huge blow in 2020 when the pandemic hit. Wiebold said that was less true for the Kenai Peninsula than other regions of the state, in part because the peninsula didn’t see such big losses from canceled cruise ships.

“In fact, the Kenai Fjords National Park had one of its best years ever in 2021,” she said. “And that was propelled by local visitors as well as some independent, non-cruise-based travelers.”

That’s a big contrast from Denali National Park, for example, which gets a majority of its visitors from cruise ships.

Since those early pandemic days, the state has been gaining jobs across all regions — slowly.

Some factors are limiting growth nationwide, like low labor force participation.

But on the whole, Alaska’s recovery is slower than other states’. Wiebold said national challenges are compounded by factors like Alaska’s reliance on tourism and oil.

“Oil’s really taken a wild ride,” she said. “And exactly why our oil jobs have been slower to recover than some of the other Lower 48 is a little bit hard to tell. But it might have to do with our more remote location, and it’s just a little bit harder to get things going again.”

Another limiting factor, she said, is that Alaska came into the pandemic in a weak position, following a three-year recession. The state was just starting to add jobs back from that recession when COVID-19 hit in early 2020.

At least one piece of legislation is expected to bring jobs this year: The federal infrastructure bill, passed by Congress in 2021. On the Kenai Peninsula, that money is expected to boost airports and harbors, among other fish passage and bluff stabilization projects.

“But what’s really difficult at this point is really tracking down where that money’s going and when it’s going to hit the road,” Wiebold said.

Construction is one industry that’s forecasted to be above its pre-pandemic levels this year, as is transportation and warehousing.

“That’s pretty much it,” she said. “Those two are going to grow above pre-pandemic levels. Everybody else is still playing catch-up. Oil and gas is a really good example of that.”

Even with forecasted growth this year, Wielbold said employment levels in that industry will still be down 25 percent from where they were before the pandemic — a difference of more than 2,000 jobs.

“So there’s plenty of industries that have a long way to grow,” Wiebold said.

And she said Alaska’s job market is still a workers’ market, since there are so many job openings. She said that provides a lot of opportunity for workers to decide how and where they want to be employed.

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