Economy takes a hit on work force

Major impact on job market linked to losses in oil and construction

Job losses in Alaska, impacted by losses in oil and construction, are impacting most of the state’s economy, state labor officials say.

A detailed report on the first six months of 2016 issued by the Alaska Department of Labor and Workforce Development said the average monthly employment for January through June was down by 5,530 jobs, or 1.6 percent, compared to the first half of 2015. Employment losses accelerated from a 1.2 percent decline in January to a 2.5 percent decline in June.

Wages paid by employers for the first six months of 2016 totaled $8.6 billion, down from $9.1 billion for the same period in 2015, a 4.5 percent decline when adjusted for inflation, labor department officials said.

Private sector jobs were down 4,867 positions, or 1.9 percent, largely due to the status of the oil and construction industries.  Oil and gas industry employment was down 2,384 jobs, which was an average monthly loss of 16.4 percent. Oil industry cutbacks rose from 11.9 percent fewer jobs in January to 22.1 percent fewer in June.

Construction jobs declined an average of 8.3 percent in the first half of the year, with steady losses each month. Specialty trade contractors and heavy and civil engineering construction were hard hit, impacted by minimal capital budgets and cutbacks in oil-related construction projects.

In the professional and business services sector, 1,536 jobs lost were closely tie to oil and construction declines. Nearly half of those losses were in architectural, engineering and technical consulting services. Managing offices and temporary help services also saw a job decline.


The loss of jobs in manufacturing, which is dominated by seafood processing in Alaska, was lower than 2015 levels by a small amount in early 2016, but May and June showed large over-the-year losses from weak salmon returns.

The wholesale and retail trade sector saw a combined average monthly employment loss of 178 jobs. Losses accelerated from January, when both sectors were adding jobs, to June, where combined employment was down by 906 jobs.

There was some growth in the transportation and warehousing sector, largely in air cargo transportation and tourism-related transportation. Other freight transportation was down slightly in response to the downturn in local consumption.

The information industry remained relatively flat from the first half of 2015 through the first half of 2016. No jobs were added in telecommunications, the largest component. Gains in the motion picture industry offset small losses in print publications. The financial services industry lost 77 jobs, mostly in real estate.

On the bright side, education and health services showed a 2.3 percent growth in jobs. Ambulatory health service employers, which have the most jobs in the sector, grew by 2.2 percent, or 400 jobs over the year. Employment in private hospitals grew by 3.3 percent, or 370 jobs. Nursing and residential care facilities added 56 jobs and social assistance added 246 jobs, for 2.6 percent growth.

The leisure and hospitality industry, which depends on local as well as visitor expenditures, was relatively flat at 0.2 percent growth, or 69 additional jobs., while restaurants and bars show a slight downturn.

Accommodates also lsot a small number of jobs, which were offset by a 3.6 percent gain in the smaller arts, entertainment and recreation sector, at 164 jobs.  Most of this growth was in fitness and recreational sports centers.

The public sector, which made up one fourth of payroll employment, was down 0.8 percent, or 663 jobs, driven by a 4.6 percent loss in state government, or 1,199 jobs.