Glasses half empty at Chamber of Commerce luncheon

Even after listening to a generally optimistic presentation about the city’s economic outlook, the majority of the 40-some people at the Juneau Chamber of Commerce luncheon Thursday said they expect to face some financial struggles in 2016.

Brian Holst, the executive director of the Juneau Economic Development Council, allowed everyone present at the meeting to look, if only briefly, through his rose-tinted glasses during his hour-long presentation to the chamber. Though Holst doesn’t conceal the fact that he may be a “smidge optimistic,” he told the audience that Juneau is not in a recession.

“We are not today in a recession, and we don’t have any evidence that we are in recession,” he said, then explaining that there is evidence to back up his view. Holst said that several important economic indicators — including rising wages and a low unemployment rate — corroborate this claim.

During the past two years government wages increased, on average, by about .3 percent, according to data from the Alaska Department of Labor and Workforce Development. In that same time, private-sector wages increased on average by about 1.5 percent. The JEDC compiled these data sets in a brochure that it distributed Thursday.

Holst also spoke briefly about how each industry in Juneau is doing. Between 2013 and 2014, the number of jobs in the fields of hospitality, arts and science and tech grew significantly. The number of state government jobs, which account for nearly a quarter of all of Juneau’s jobs last year, remained relatively static. However, the number local and federal jobs, both among the city’s higher-paying jobs, decreased.

Rather than asking whether we are in a recession, Holst said that people should be asking if we are headed into one “because that is certainly plausible.” And according to most of the people in the room, we are.

At one point during his presentation, Holst presented his audience with four statements about Juneau’s economic outlook for the coming year. The statements, basically a Likert scale, ranged from the ultra-negative “we’re doomed” to the ultra-positive “we’re better than ever.” Using a text-message-based polling system, Holst polled the audience and found that 64 percent of respondents, most of whom hold high-ranking positions in businesses from the area, expect that Juneau will encounter some economic hardships in 2016.

The doom-and-gloom response received 12 percent of the votes. The overly cheery response received 8 percent and 16 percent of respondents said they are not particularly worried headeing into next year.

After the presentation, Holst told the Empire that he doesn’t believe the city is headed into a recession but there is “one big caveat.” It depends on how the state Legislature handles its budget crisis, he said.

In a community that is heavily dependent on state government jobs — which account for almost 30 percent of the city’s total wages, according to the JEDC — the actions of the Legislature could have drastic impacts.

“We could create a recession by having dramatic cuts in government spending,” Holst said after his presentation. “It’s a little bit out of our hands, but it is within the control of the Legislature, and I remain optimistic that our elected leaders can get us through this.”

Holst also spent a healthy portion of his presentation discussing migration in and out of Juneau. Between 2010 and 2011, the city experienced a net migration of 586 people. This means that there were 586 more people who came to the city than who left during that time period. Since then the net migration has been declining, and between 2013 and 2014 the city’s population decreased by 227 people.

Compared to the city’s overall population of more than 32,000, this negative net migration is rather small and is not a cause for concern, according to Holst and JEDC program officer Eva Bornstein.

“It’s a miniscule departure,” Borstein told the Empire after Holst’s presentation. “It’s not a mass exodus, and at the moment, it’s not a worry number.”

During his presentation, Holst explained that Juneau’s population shifts are determined by a sort of “push and pull.” Juneau’s high cost of living, for example, may “push” residents to move to other cities. It’s high quality of life, on the other hand, may “pull” people to it. The improving economy of the Lower 48 may explain last year’s negative net migration, Holst said.

• Contact reporter Sam DeGrave at 523-2279 or at

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