Alaska's economy to continue to grow, experts say
State's vast natural resources likely to be foundation of economic strength
Alaska’s economy has been doing well while others have faltered, and is poised to continue to do so, the World Trade Center Alaska’s Statewide Economic Forecast Forum was told.
Among the industries that have done the best in the last year have been the state’s export industries, including seafood and mineral resources, and that’s likely to continue.
“Fish had a great year last year, it was a fantastic year for fish,” said Jonathan King, an economist with Wells Fargo Bank.
While halibut didn’t do so well, salmon and other groundfish brought wealth to the state, he said. And export money is particularly important; that means new dollars are coming into the economy, so people are not simply passing the same money around, he said.
Mining has also been doing well, especially in Southeast Alaska, where Coeur Alaska’s Kensington mine went into service in the last year.
The recession faced by the nation was the biggest and longest since the Great Depression, but could have been much worse and much longer without government stimulus programs and other efforts to shore up the economy, King said.
“They really did save the bacon,” he said.
King was one of the experts speaking at the World Trade Center’s annual event, held in conjunction with the Juneau Chamber of Commerce.
At about the time of the Lehman Brothers bankruptcy, authorities also had to step in and take steps to keep the banking system operating.
“That kept the financial system from really melting down,” King said.
While the nation is now pulling out of that recession, oil, fishing and mining kept that recession from ever hitting home.
“We really skated through the national recession, it was a really mild, very short recession — unless you happened to lose your job — here in Alaska,” King said.
Even now, the national recession waning, growth will be slow nationally and in Alaska, he said.
“Corporations are flush with more cash than they’ve ever had,” he said, but they aren’t using it.
“Corporations are not taking that cash and turning it into hiring, that’s why it feels like the recession is still going on,” King said.
In Alaska, however, the key industries are poised for continued strength, he said.
“It’s going to be another great year for mining here in Alaska,” King said.
Lt. Gov. Mead Treadwell, who visited the remote Kensington Mine when it opened last year, said the state would be working to bring the kind of jobs it brought to Juneau and elsewhere as well.
“We’re working hard to gain greater access to our resources and job opportunities,” he said.
In addition to Alaska’s well-known oil resources, the state contains 3 percent of the world’s zinc, which would rank the state eighth in the world if the state were a country. It also has 3 percent of its gold, ranking seventh in the world, and 6 percent of its copper, ranking third in the world.
Alaska has 17 percent of the world’s coal, ranking it second in the world and holding the potential for huge exports if that resource could be developed.
Greg Wolf, executive director of the World Trade Center Alaska, said the state’s resources are likely to keep the state’s economy going strong in the coming year as well.
“We’re in a sweet spot right now,” he said. “We have what the world needs and increasingly the world has the money to buy it,” he said.
The world’s emerging economies will soon surpass the developed countries, if they haven’t already, but billions of Asian consumers with money to buy Alaska products could benefit Alaska, Wolf said.
“There’s some seafood products that Americans just don’t eat, but they’re highly prized in Asia,” he said.
The weakening U.S. dollar will help make American exports more completive, Wells Fargo private baker Jon Snare said.
“Some things that are good for Alaska aren’t good for the United States as a whole,” he said.
• Contact reporter Pat Forgey at 523-2250, or patrick.forgey@juneauempire.com.