Decline in Alaska population of millennials could be tough on employers

Alaska isn't just the second-youngest state in the union. Its population remains younger as well.

The median age in Alaska is 33.4 years old, compared to 37.4 nationally.

But the number of people ages 20 to 29 years old in Alaska has steadily declined over the past seven years, said state economist Neal Fried.

Fried said that gives some advantages for millennials — roughly 18 to 35 years old — to pick from jobs requiring certain skill sets.

"(The younger age groups') employment chances look bright because there's not as much competition," Fried said.

But it means a harder situation for Alaska's employers, as the Anchorage Economic Development Corp. documented in a recent study.

State demographic data from 2010 to 2017 shows that the number of 18-year-olds fell by 1,164 people in Alaska, from 10,498 to 9,334.

In the 24-year-old count, the number fell from 11,568 in 2010 to 10,600 in 2017, or 968 fewer.

Alaska demographer Eddie Hunsinger said overall, the age 20 to 29 population fell from 109,383 in 2010 to 106,044 in 2017, or 3,339 fewer. The data are gleaned from the Alaska Permanent Fund Dividend application filings each year.

"The number of prime working age adults is declining, or not expected to grow in the next 20 years," Fried said. "The numbers have been falling in the younger demographic in Alaska, but it's following on a national trend as well."

In addition to its impact in the workplace, Alaska demographic changes also have ramification for certain kinds of businesses, Fried said, while other aspects of an economy are not that fazed by broad changes in demographics.

"Groceries for example, they will need, though products in the store may change," he said.

"Businesses are usually well aware of what groups they cater to, but an economic spin sometimes is a demographic spin. A change in demographics can also be dictated when fewer members of an age demographic are documented over time."

Alaska has grown accustomed to the high need for health care professions as the baby boomer generation ages.

When the boomer generation was coming of age, they flooded the market during their prime working years, Fried noted, which meant more competition for jobs. But the number of college graduates was a smaller fraction of that generation than the millennials, 25 percent of whom gain some kind of degree.

When the numbers lag in that demographic, there may not be enough people to cover the positions traditionally offered to the 18- to 30 year-old employment grouping. Fast-food establishments to retail stores to full restaurants dependent on large numbers of younger people entering the workforce say they can't always find all the workers they need, Fried said.

When that happens, such businesses compete from a limited work pool, Fried said, or hire older workers from the baby boomer population, born between 1946 and 1964.

The occurrence of Alaska's downturn while a brighter economic boom goes on outside Alaska also is a factor. That draws a young demographic away, including college students who choose not to return. Fried said there's only so far you can go with data, however, and the next steps have to come in what employers say about whether they can draw and retain a younger workforce.

Fried doesn't bemoan the so-called "brain drain" that happens in a discussion about whether or not Alaska tends to lose its young, newly educated workforce.

"It's a two-way street," he said. "People leave but people also come here. That's the nature of the demographic. We gain others who have the skills Alaska needs."

Perhaps just not in the numbers wanted by employers.

AEDC millennial study

The Anchorage Economic Development Corp. released a study based on a survey of 1,064 millennials, which they defined as individuals born between 1980 and 2000. This is the age group that currently makes up a third of the city's workforce, the Millennial Workforce Survey found.

It's also the generation that makes up a quarter of the total U.S. population.

AEDC starts its report stating the goal behind its Live.Work.Play. Initiative is to make Anchorage "the number one city in America in which to live, work and play by 2025."

The initiative means to attract and retain a highly skilled workforce. It came about at the request of the business community wanting to know how to attract and keep workers here. Anchorage sees a shortage in technical skills, professions like accountants, health care, even carpenters and oil field workers.

"It's across the board. We can't find the workforce we need," said AEDC communication director Sean Carpenter. "We had heard a lot of that. Other cities experience the same thing. So we took the question to see if there's a way we can answer it."

Making Anchorage attractive helps draw people with skills and talents. "Business chases talent, and talent chases place" is a premise behind the study.

Clues were teased out from the question of what millennials want in their jobs.

A paycheck isn't as important to 75 percent of the Anchorage survey respondents as "good management," according to AEDC's findings.

"While Millennials do care about wages and benefits, it is evident that other factors like good management, scheduling flexibility, workplace culture and having an interest in the field of work are all aspects that play a critical role in employment decisions," the survey concluded.

Some 91 percent said having a positive impact on society is either somewhat or very important to their job satisfaction.

These passion factors "are critical for employers to take into consideration when considering the structure of positions that are available to younger professionals," according to the study.

When asked if they valued telecommuting — working remotely from home or elsewhere — results indicated this was a "low priority for Anchorage residents deciding where to work."

Flexibility was one of the highest-ranking job factors. This isn't the generation that wants a 9-to-5, but rather built-in scheduling and time-off options. The higher educated, the study found, the more they desired this job characteristic.

For employers who say they are frustrated with this generation's work habits, there's a communication gap to heed: According to this survey's results, communication problems are listed as the biggest on-the-job frustration by 71 percent of the millennial respondents.

"This finding was significant because it may indicate that employers have systems or methods of communication that are inadequate and are leading to frustration for Millennial employees," the report concludes.

Millennials are often defined as a generation reliant on electronic communication such as email or text, and not as comfortable in "face-to-face" encounters.

Bill Popp, president and CEO of AEDC, said the problem lies in a "top-down military model" of workplace communication hierarchy.

"The broader workforce is left in the dark while communication goes mainly between the top managers," Popp said. "The horizontal model gets better contributions from young millennials. That's how you bridge some of those issues. They want to be inspired by the mission. To be inspired by the mission, you have to know the details" of workplace goals.

So rather than millennials being at "fault" for possessing poor communication skills, Popp recommends businesses reconfigure "our leadership systems. It's a flaw in the system."

AEDC also heard from employers in a separate 2018 Business Confidence survey. One question was "what is the biggest barrier to growth in your business in 2018?"

Out of top six barriers, three were labor related, Popp said. A top complaint was the lack of skilled and professional workforce availability. Business majorities see a lack in the semi-skilled workforce.

"The three top concerns centered around the labor force — in the third year of a recession," Popp said. "It tells us that there are things going on here that we are not addressing."

Naomi Klouda can be reached at