The Southeast Alaskan economy is revving up, but there are serious obstacles to continued growth: Namely, young families are finding it difficult to live in the region, and many are leaving.
Reversing the outmigration of young people is becoming a regular refrain of economists and others who keep an eye on trends.
The issue has been in the background for a few years now. The steady economic growth in sectors like cruise tourism and healthcare is undermined by a continued shortage of housing in Southeast, and by a lack of childcare.
Sitka Chamber of Commerce director Rachel Roy was the commencement speaker for the University of Alaska Southeast Sitka Campus graduation ceremony in May. Roy told the graduates that she had her first child the summer after her freshman year, and continued to juggle babysitters and coursework through earning her Master’s Degree.
Roy stuck it out, and encouraged her audience to do the same.
“We need you,” she said. “We need your skills, your curiosity, your resilience. We need your voice in research labs, in fishing boats, in classrooms, on city assemblies, and in boardrooms.”
But it will take more than curiosity and resilience to keep young people in Southeast. In February, Meilani Schijvens presented a detailed report to the mid-session meeting of the Southeast Conference in Juneau. Many of her numbers, like the growth in jobs and wages, were really promising, but she told a story that spoke more loudly than any pie chart.
“I ran into someone at the gym the other day, and I said, ‘You know, when we're looking at these early numbers for 2024 I can tell you, just in a nutshell, the Southeast Alaska economy is great.’ And she said, ‘Well, tell that to my four daughters in their twenties that really want to move home and live here, but can't afford to because the cost of housing is too high,” said Schijvens. “And so I have a caveat: The Southeast Alaska economy is great, depending on who you are.”
It wasn’t too long ago that an efficiency apartment in Sitka cost about $750 a month. The March edition of Sitka’s Economic Trends, published by the local Economic Development Association, reports those rents are now over $1,000. A three-bedroom unit in Sitka now goes for $2,100 a month.
The four daughters Schijvens heard about at the gym are a statistical sample of an even larger problem that has developed in Southeast over the last decade.
“We have 6,000 fewer people of that sort of prime workforce age,” said Schijvens. “We have 7,600 more seniors. But at the same time, we have 1,700 more jobs. So we're doing great on jobs. We're just struggling when it comes to having that strong workforce age population.”
“Prime workforce age” refers to residents between the ages of 20 and 59. When prime workforce workers leave Southeast, so do their children. School enrollment in Southeast communities like Sitka has been in steady decline for at least two decades. Teacher turnover has been extraordinarily high the last few years – Sitka alone lost 14 teachers for the academic year that just ended.
Sitka Rep. Rebecca Himschoot is a former teacher. In an interview with KCAW, Himschoot said that she hopes an all-new teacher retirement bill (HB 78) now working its way through the legislature helps stabilize education, and attracts a younger demographic to the state.
“So when we have teachers who come here because we have, I hope, a great salary, we have great working conditions, and we offer some sort of retirement with dignity, and they invest in their community, and they raise their kids here and they become great teachers over time – that's a win,” said Himschoot.
New housing is being built in most Southeast communities. Juneau tops the list with almost 1,200 units in the last ten years. Ketchikan is next with 366, and Sitka third with 291. But Meilani Schijvens’s report suggests that it’s not enough to cure the shortage, or to create affordability.
Basically, the downward pressure of these economic factors is greater than the surge in jobs and wages. Southeast has lost over 4,000 residents in the last decade, and the strengthening economy is not bringing them back.
State Department of Labor projections show 15,000 people leaving the entire state by 2050, with 12,000 coming from Southeast alone.
