A legislative committee chaired by Sen. Dennis Egan, D-Juneau, met in Fairbanks on Tuesday to look into a point of contention during the last legislative session’s oil tax debate.
Among the questions committee members wanted answered was: If oil taxes are so high that they’re stifling North Slope development, as oil company allies such as Gov. Sean Parnell claim, why is the oil and gas industry posting record employment numbers?
Or, in the alternative: If things are going so well in the oil patch, why are so many Alaskans who want to work there unable to get hired?
The problem, some legislators are concluding, is that while oil companies are adding jobs, they’re bringing in their new employees from out of state.
“Alaskans are rightly concerned that at a time of near-record employment in the oil industry, fewer of those jobs are going to Alaskans,” said Egan, chairman of the Senate’s Labor & Commerce Committee, which held the hearings.
Parnell’s House Bill 110, which would slash state oil tax rates, ended the last session in Egan’s committee.
At the Fairbanks hearing, workers told the senators while the industry was seeking lower taxes, the Legislature needed to focus specifically on Alaska hiring.
“For too long we believe this has been given lip service — it’s time we face it head on,” said Jay Quackenbush, with the Fairbanks Building and Trades Council.
State Department of Labor and Workforce Development data show oil and gas employment in the state hovering at an all-time high, but too little of the North Slope work is going to Alaskan contractors and Alaskan workers.
“What little work that has come to our Alaskan contractors, they’ve found it difficult to find bed space in the camps,” Quackenbush said.
“The problem is the camps are full, but not with Alaskan workers,” he said.
In some cases, the camps are so full the “reprehensible” practice of “hot sheeting,” where two workers who work different shifts share the same bunk, is being reported, said Tim Sharp, business manager for the Alaska District Council of Laborers.
At the same time, Alaskans can’t get jobs there.
“The frustration in Fairbanks runs deep,” he said.
A few voices spoke up for the out-of-state workers, however, and oil industry allies tried to refocus the discussion on tax reductions.
“In 1976 my father was a non-resident worker,” said Joseph Blanchard, a member of the Fairbanks North Star Borough Assembly and a student at the University of Alaska Fairbanks.
He said the tourism industry, in which he works during the summer, has a worse resident hire record than does the oil industry.
“I work with plenty of folks who barely speak English,” Blanchard said.
Kara Moriarity of the Alaska Oil and Gas Association said Alaska benefits from new jobs even when the workers are from elsewhere.
“Non-resident hire is part of what allows Alaska’s economy to grow,” she said, pointing to he seafood industry as one with higher non-resident hire than the oil and gas business.
She acknowledge there had been an increase in North Slope employment, but said the state should instead focus on diminishing oil production.
“Regardless of jobs, production in Alaska continues to decline,” Moriarity said.
She said even last year’s robust exploration year wouldn’t translate into more oil in the trans-Alaska oil pipeline anytime soon.
“I urge the committee to focus on efforts that will increase production,” said Lisa Hebert, executive director of the Fairbanks Chamber of Commerce.
Not everyone believed all of the numbers they were hearing.
Sometimes, said Doyon Ltd. President Jim Johnson, those out of state workers are actually long time-Alaskans who moved away but return to work.
“We have employees who we hire here in Alaska who move Outside because it is cheaper to live Outside. It’s as simple as that,” he said.
Lynden Transport’s Ken Hall said he’s seen that as well when his workers moved.
“The expense of living in Alaska and in Fairbanks has played a factor in a number of our employees,” he said.
The Senate Labor & Commerce Committee’s hearing on House Bill 110 will continue tomorrow in Anchorage. No official action is taken during interim hearings.
• Contact reporter Pat Forgey at 523-2250 or at email@example.com.