Anchorage is in for neither a particularly strong nor weak year in terms of employment growth, according to the Anchorage Economic Development Corp.'s 2015 economic forecast.
Private sector jobs are anticipated to grow, while losses in government jobs will offset those gains, said Bill Popp, president of the AEDC.?
Anchorage's economic forecast for 2015 is "flat." That means "we're not adding jobs but we're not losing jobs either," Popp said.
Alaska is entering "another period of oil price-related uncertainty," the 2015 Economic Forecast report says.
But, "we are really in a good spot to start from in these challenges. We're in all-time record high employment," Popp said. Alaska's banks hold $11 billion, and the labor market is "very tight," he added.
The two aspects that will affect Anchorage's future most are the price of a barrel of oil and the results of the state budget process, Popp said. On Thursday, Gov. Bill Walker announced his proposed budget, which aims to cut $240 million in agency spending.
Two reports released Thursday outline projected employment forecasts and Anchorage-area business confidence.
The 2015 Economic Forecast notes several trends:
-- In 2014, Anchorage's population decreased slightly for the first time since 2006, losing about 250 residents.
-- Total employment showed an unexpected slight decline in 2014. This was due to sinking oil prices, which prompted employers to slow down on hiring, Popp said.
-- "2014 will be remembered as the year the U.S. unemployment rate sank below the Alaska level," the report says. The 2008 recession caused the national unemployment rate to jump from 5.8 to 9.3 percent, whereas in Anchorage, and Alaska as a whole, the rate grew only 1.3 percent. Nationally, unemployment rates have been declining since 2010, whereas in Alaska the rates have flattened. The U.S. rate is "likely to continue declining" and return to being closely aligned with Anchorage's unemployment rate, the report says.
-- Inflation rose 1.6 percent in 2014, the slowest rate of increase since 2010, according to the report. "AEDC expects inflation in 2015 to continue trending below the 10-year average, depending largely on fuel prices."
-- Industry sectors with the largest increases are expected to be health care and retail trade, both anticipated to add 300 jobs this year.
-- Government employment is expected to see the largest decrease, with 500 jobs anticipated to be lost among federal, state and university employees.
In addition, AEDC's annual business confidence index shows declining optimism by 245 businesses surveyed for the report. Businesses felt that the biggest barriers to growth are the "condition of the state economy" and the availability of professional and technical workers. Declining North Slope oil production was seen as the most important issue to the Anchorage economy.
Still, businesses are positive about their own businesses, and 53 percent of businesses surveyed said they'd be hiring in 2015, Popp said.
Overall, 2015 is expected to be neither particularly good nor bad in terms of growth, Popp said.
"The jury's still out on what the future will hold beyond this year," he added.
Alaska Dispatch Publishing