A decline in industrial jobs, an aging population, low salmon prices and an increase in lower-paying jobs all have contributed to a decrease in per-capita income for Sitkans, according to a new report.
The study "The State of Sitka's Economy" by the Juneau-based research firm the McDowell Group, reports the average income in Sitka has dropped from 142 percent of the national average to 98 percent in recent years.
The Alaska Department of Labor reported that in 2001, Sitka's per-capita income was $29,734, just below the U.S. average of $30,413. Juneau ranked at $34,487, Ketchikan at $34,040 and Alaska at $31,027.
But during a period of declining wages, employment in Sitka rose for the fifth consecutive year. Employment increased by 3.1 percent, or 131 jobs.
Jonathan Krebs, executive director of the Sitka Economic Development Association, said the increasing jobs and declining wages could be a reflection of the community relying on more tourism jobs.
"Tourism doesn't pay as well as the former mill workers made," Krebs said.
In 1993, the Alaska Pulp Corp. closed its pulp mill in Sitka due to expensive upgrades necessary to continue running the facility and a decline in world prices for paper.
"I think a town that has suffered the mill closure and has suffered a poor U.S. and state economy has done relatively well in spite of that," Krebs said.
Krebs said commercial fishing remains the top industry for Sitka, but tourism is also on the rise.
Mercedes Angerman, executive director of the Sitka Convention and Visitors Bureau, said both cruise ship travelers and independent travelers to Sitka have increased in recent years.
More than 256,000 cruise ship passengers visited Sitka in 2003. Bed tax revenues also have increased from 2001, indicating an increase in independent travelers.
But next year, tourism revenue likely will drop due to one fewer cruise ship visiting the coastal community, Angerman said. This could result in a 10 to 20 percent drop in cruise ship revenue, she said.
She said West Coast vacationers are the top travelers to Alaska, with most people coming from California and Washington.
The economic indicators report also showed that in 2002 Sitka's population of 8,894 increased by 0.7 percent, or about 58 people.
Southeast's population was approximately 73,000, according to the report.
But while population is increasing, school enrollments continue to decline. This indicates that demographics are shifting to an older population.
Timothy Inklebarger can be reached at firstname.lastname@example.org.
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