Alaska's unemployment rate continued its fall in March, as the state's oil boom continued to buffer the state from the 2008 recession that has plagued the rest of the nation. In March, oil and gas jobs hit a monthly record at 14,000, according a Friday report issued by the Department of Labor and Workforce Development's Research and Analysis Section.
The advocates of oil tax reductions, including the industry, Gov. Sean Parnell and allied legislators, have made claims that the state's ACES oil tax has resulted in a decrease in jobs and was forcing Alaskans to leave the state to find work.
Actually, state employment in general, and oil and gas jobs specifically, have been hitting new records repeatedly since the state's progressive tax system was adopted in 2006 and then increased with the adoption of ACES in 2007.
Parnell continued the jobs theme last week when he praised the Legislature for passing Senate Bill 21, the oil tax bill he supported.
"A future of new jobs, new opportunities, and a bright future for all Alaskans starts now," Parnell wrote in an opinion piece published in the Anchorage Daily News following the bill's passage.
The 14,000 oil and gas jobs counted by the Labor Department in March is more than the yearly average for any previous year, and will likely be exceeded by July and August, traditionally the peak months for employment.
Alaska's unemployment rate has traditionally been above the United States' rate as a whole, which state economists say was likely due to the large amount of seasonal work in the state. In 2008, however, the national rate shot up several points during the recession, and has been above the Alaska rate ever since.
The March rate of 6.2 percent in Alaska was substantially below the U.S. rate of 7.6 percent. In recent months the state has even been widening its lead over the nation as the Alaska economy improves more quickly than the struggling national economy.
Since peaking at 8.2 percent in early 2010, Alaska's rate has been on a generally downward trend over the last three years, said Dan Robinson, state labor economist.
State legislators such as Sen. Bert Stedman, R-Sitka, said protecting the economy was the intent when they used the state's oil windfall from ACES and unexpectedly high prices to maintain the Alaska economy. While other states drove themselves deeper into recession by slashing government spending, Alaska maintained spending and even boosted capital spending by billions of dollars during that period.
Now, said Rep. Bill Stoltze, R-Chugiak, the time has come to cut back on capital spending. The capital budget for next year passed in the final days of the just-completed legislative session recognized declining prices and production, Stoltze said.
Though it was a billion dollars less than the current capital budget, it was still fairly large by historic terms.
"We have a robust budget this session, but will be looking at tightening our belts going forward," he said.
Alaska's strengthening economy may mean those robust capital budgets won't be needed to stave off recession in the future.
The state's seasonally-adjusted 6.2 percent rate in March was below the state's 7.0 percent rate in March 2012. During that time the number of unemployed residents in Alaska dropped by more than 4,500, to about 24,000, according to the department.
Contact Pat Forgey at pat(at)alaskadispatch.com