Report: Tourism important to Alaska

Comprehensive report lists travel/tourism as 7th largest private industry

Posted: Monday, April 26, 2004

The travel and tourism industry contributed $851 million to Alaska's economy in 2002, making it the seventh largest private industry in the state that year, according to a study completed by the Alaska Department of Community and Economic Development this month.

The study is the most comprehensive of any completed in the state to date, said Caryl McConkie, economic development manager for the Office of Economic Development. She worked with consultant Christopher Pike of Global Insight Inc. to produce the study.

"Tourism right now is defined more by what the visitors spend," Pike said. "But to compare tourism as an industry, we need to get a feel for the overall impact on the state."

The core tourism industry, composed of businesses that provide products and services directly to travelers, generated $851 million of what economists call Alaska's gross state product - the net amount of money generated by an industry in the state.

The noncore tourism industry, which includes the portion of banking, construction, real estate and government business that is conducted to support the core tourism industry, contributed $1.5 billion to the gross state product.

Because the travel and tourism industry does not have its own account in federal industry classification systems, the World Travel Organization developed the "tourism satellite account" to measure the impact of the industry.

The inclusion of in-state travel is the major difference between this study and those that have been done in the past, said Jim Calvin, a partner at the McDowell Group, a Juneau-based consulting firm.

"It's not a tourism impact analysis, it's a travel and tourism impact analysis," Calvin said. "That means that when you or I travel to Anchorage on business or for medical reasons or whatever, it's included in this study."

Several countries, states and cities have begun to use the tourism satellite account in recent years to get more precise measurements of the economic impact of travel and tourism, Pike said.

The more this type of analysis is used in different states, the more useful it will be, said McConkie. It will allow Alaska to compare the impact of the travel industry here with the impact in other states.

Sales in travel and tourism in Alaska amounted to $2.4 billion in 2002. Of every dollar that is spent on tourism in Alaska, 63 cents stays in the state, Pike said.

The core tourism industry employed 26,000 people in Alaska in 2002. According to the study, the travel and tourism industry was the third largest private sector employer in the state that year.

Non-core tourism jobs bumped the total employment in the travel and tourism industry in Alaska to 37,650, Pike said.

That number was surprising to Ron Peck, president of the Alaska Travel Industry Association.

"We've been saying for a long time we estimate between 25- and 28,000 people are employed in tourism," said Peck. "But when it breaks it down that we're responsible for 37,000 jobs, that's a big number."

Though the ATIA has in the past said that tourism is the third largest industry in the state, several spots higher than it ranks in this study, the number seven ranking looks good for the visitor industry, Peck said.

"We're ahead of fishing, timber, metal mining and other industries that this state thinks are very important," he said.

Pike was in Juneau last week to train state economists in performing annual studies similar to the one Global Insights produced this year. A yearly analysis of the tourism industry could help those in the tourism industry make their case for more state funding for tourism marketing, McConkie said.

"To be able to talk about investment, you need to know what you're getting for your investment," McConkie said.

• Christine Schmid can be reached at

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