"We view things as we are, not as they are." - Anias Nin
This quote is appropriate given recent discussions over the future of Juneau and Southeast Alaska. As a community, Juneau truly has much to offer; an incredibly scenic location with unparalleled recreational opportunities, community spirit, low crime, excellent electronic infrastructure and sustainable hydro-power with the second lowest rates in the state. Our strong reliance on government gives me cause for concern. A diversified economic base should include payrolls from several indus- tries, which produce a product and create wealth. For a high quality of life (good infrastructure, better schools, recreation facilities and arts) we must have the economic vitality that stems from a broad tax base and family wage jobs.
The good news is that Juneau is growing as a service hub for the region. In addition, we have an expanding small manufacturing sector. The Greens Creek mine is the largest single producer of silver of any mine in the U.S., and we are the fifth largest halibut port in the world in terms of pounds of halibut landed. Manufacturing, minerals, seafood processing, the timber industry, tourism and related services all create rungs to the economic ladder. Yet we have much work ahead as shown by recent economic trends.
Some sobering economic indicators of regional and local trends; per capita income in Alaska is now within 1 percent of the U.S. average (2000). By comparison, in 1995 per capita income in Alaska was 9.4 percent higher than the U.S. average. In a 1999 memo, the U.S. government noted that over the 1996-99 period Alaska was the ONLY state in the U.S. to experience a decrease in per capita income. This lack of income growth is further reflected by the fact that Alaska was 49th in growth of GSP (gross state product) during the period from 1992-99.
Locally between 1990-2000 real wages in Southeast have decreased 9 percent! To put the changes in per capita income into a statewide perspective, between 1990-97 the average annual rate of change of per capita income was 3.4 percent for the Interior, 2.3 percent for the Anchorage/Mat-Su region and 1.7 percent for Southeast. According to the ACCRA cost of living survey in which JEDC participates, Juneau is 30 percent above the average in cost of living for the 308 participating communities (by comparison Anchorage and Fairbanks are approximately 23 percent above the average). These indicators show that Juneau and Southeast are behind the state in economic growth. Contributing to these changes is the population growth in the Mat-Su region, the slow growth in Juneau and population decline in some regions of Southeast.
Over the last decade Juneau has seen some shift away from government dependence. The private sector now accounts for over 55 percent of the total employment in Juneau. By comparison, in 1994 government positions accounted for 59 percent of the total employment. Outsourcing of government work has accounted for some of this shift (much of the local private sector employment is directly related to government), along with growth in tourism and the service sector. Nevertheless, the key economic engine in Juneau remains state government.
The upshot is that in the last decade Alaska has lagged behind the U.S. in growth, and Juneau and Southeast have lagged behind the state as a whole. Regardless of the reasons, with these changes in the economic landscape for Juneau and Southeast we as a community, and as a region, will need to embrace and foster a healthy business climate. To many, Juneau has the reputation as a difficult place to conduct business. Perception can be reality. We have the opportunity to change this. We must be able to move ahead on projects such as the golf course, airport improvements and construction of the NOAA facility. The alternative is for business and investment in our community to move elsewhere. Retaining and attracting business will require government and the private sector working together.
This is a pivotal time for Juneau. We must try to "view things as they are" and act accordingly to support economic development. The alternative is an eroding economic base, coupled with declining investment in business and infrastructure. We must act now to ensure that Juneau continues to be a great place to live, work and play.
Lance Miller holds a Ph.D. in economic geology and is the executive director of the Juneau Economic Development Council. Visit www.jedc.org to learn more about JEDC, to ask questions or give comments.
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