Anchorage Daily News

Alaska will join the national recession in 2009.

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The state will lose hundreds or possibly thousands of jobs this year, depending on which economic forecast you consult.

It will be the first time that Alaska has lost jobs in 22 years. The global economic crisis and declining commodity prices are mostly to blame, state economists say.

"The longer this goes on, the more likely it will drag on Alaska's economy," said economist Pat Burden on Wednesday, speaking at downtown luncheon hosted by Wells Fargo Bank and the World Trade Center Alaska.

His firm's economic forecast for Alaska -- the gloomiest -- predicts that the state will end up with 3,400 fewer jobs this year, a 0.6 percent decline.

The Northern Economics Inc. analysis shows that the worst-hit industries will be resource extraction, construction and transportation.

The Alaska Department of Labor has a less gloomy forecast. It says the state likely will lose 700 jobs this year, said state economist Dan Robinson. The state's analysis differs from Northern Economics' in that it doesn't include the self-employed or military jobs.

Burden predicts that every business sector in Alaska will lose jobs this year. The only sector Burden says will expand is government, mainly due to an expansion of local government jobs, plus some growth in military, state and federal jobs, he said.

Robinson is less optimistic about government job growth. He predicts no gain, but no loss of jobs either.

Job growth statewide has been slowing since 2005, but rising oil prices, bigger state budgets and strong federal spending have combined to prop up the economy in recent years.

SOFTENED ECONOMY

Job losses are just one of the many signatures of Alaska's softening economy.

Here's some others:

• Commodity prices in Alaska are at their lowest level since 2004, economists say. That includes oil, zinc, seafood and other products shipped Outside.

• This year's gross state product -- the net value of all goods and services produced in Alaska -- could decline $14 billion, or 26 percent, mainly due to lower oil prices, according to Northern Economics.

• Corporate and government income could decline by about $400 million, or 1.5 percent, the firm said.

• The value of Alaska's exports could decline slightly this year, to as low as $3.5 billion compared to $3.7 billion last year, according to a World Trade Center Alaska analysis.

• Fewer tourists streaming through Alaska and less international air cargo flowing through Anchorage are two other ways the global recession could pinch the economy.

BETTER THAN THE REST OF U.S.

The state's economy remains in much better shape than the United States economy as a whole, economists said Wednesday.

During the first nine months of last year, Alaska gained jobs while the nation was losing them, Robinson said.

It's even possible the state will begin this year with job gains rather than losses, he said.

But at some point this year, Alaska will join the U.S. recession, he said.

Hammered hardest will be the state's businesses that extract oil, gas, zinc and other resources. Northern Economics forecasts those businesses will shed 1,100 jobs this year.

But Robinson notes that the oil industry added 1,000 jobs alone last year amid record oil prices. "We expect it (employment) to be down by the end of year; 2010 might be where you get bigger losses," he said.

He and other economists are also watching a rare event: The U.S. unemployment rate is quickly catching up with Alaska's.

For the past 25 years, unemployment in Alaska has been greater than the nation's jobless rate. That could end this year, Burden said.

Right now, the state's 7.3 percent unemployment rate is only one-tenth of a percentage point higher than the national rate.

How accurate are Burden's and Robinson's forecasts? Burden acknowledged he underestimated last year's statewide job growth. Robinson's forecast was much closer.

Find Elizabeth Bluemink online at adn.com/contact/ebluemink or call 257-4317.

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