Brian Holst, executive director of the Juneau Economic Development Council, presents findings from JEDC’s annual economic indicators report during a Greater Juneau Chamber of Commerce luncheon Thursday at the Juneau Moose Family Center. (Mark Sabbatini / Juneau Empire)

Brian Holst, executive director of the Juneau Economic Development Council, presents findings from JEDC’s annual economic indicators report during a Greater Juneau Chamber of Commerce luncheon Thursday at the Juneau Moose Family Center. (Mark Sabbatini / Juneau Empire)

Juneau’s aging population and low fertility rates raise concerns about declining future

Annual JEDC report also shows growing income gap, plus high housing and healthcare costs.

Juneau’s aging and declining population — due largely to departing residents and a “really, really low” fertility rate — present a troubling future despite a local economy showing strong, but uneven, growth, the executive director of the Juneau Economic Development Council said while presenting an annual report by his organization Thursday.

The number of people in Juneau over age 60 exceeds those under 20 for the first time in recorded history, said Brian Holst during his presentation to the Greater Juneau Chamber of Commerce luncheon at the Juneau Moose Family Center. He also noted Juneau currently has a 1.3 fertility rate — with 2.1 being considered necessary to maintain the current population — so the population will decline “unless we bring in new people or have more babies.”

“This is something that we all need to understand and get our heads around,” he said. “Because this is going to have a big impact on how we think about what we should do as a community.”

Numerous factors account for population decline and increase in average age, including high housing and healthcare costs, an economy where both the number of wealthy people and those in poverty are increasing, and a workforce where certain well-paying stable jobs such as government are declining while seasonal jobs like tourism are increasing, Holst said.

Juneau’s population was about 32,000 in 2022, but is expected to decline to 30,813 by 2035, according to the Alaska Department of Labor and Workforce Development, Holst said. He said the continuation of such trends poses significant challenges.

“If we have a 20% decline in our under-20 we’re going to be closing schools down,” he said. “It’s going to be hard to fill up that university and our summer workforce. We have a huge, strong summer economy and our workforce in summer is reliant on those workers.”

Workers will also be needed for the year-round residents who are remaining in increasing numbers, Holst said.

“Then we have a growing population here — that older population — that requires services,” he said. “And this community is not well set up for services. I don’t see a super-rosy picture about what we look like going forward.”

Holst expressed more optimism about Juneau’s overall economic situation, based on the annual “Economic Indicators and Outlook” report published by JEDC in October. The data is based on 2022 figures, so there is an obvious general upward spike reflecting a return to something near normalcy after the lows of the COVID-19 pandemic, but Holst said data so far this year remains encouraging.

“We expect FY23, just based on what we’re seeing from the sales tax revenue from the city, that the overall sales are going to continue to head up,” he said.

Among the most notable figures is a record-low level of unemployment, which was 2.8% in 2022 and 2.7% in July of this year, Holst said. Local rates between 2013 and 2021 ranged between 4% and 6.6%, while the statewide rate in 2022 was 4% and the national rate 3.6%.

“Juneau is experiencing the lowest unemployment rates since the Department of Labor does statistics,” he said. “It is not your imagination, it is. If you want a job in Juneau you can probably find one and it’s hard to recruit people for positions.”

But employment by profession in 2022 varied widely, according to the JEDC report. While average monthly employment was 5.33% higher overall, service sector jobs were up 10.77%, goods-producing jobs up 5.03%, local and tribal jobs up 3.46%, and state government jobs down 4.08%.

“The government sector remains important to Juneau, but continues to stagnate in terms of overall jobs and wages,” the report notes, adding “2022 marks the tenth consecutive year of fewer State of Alaska jobs in Juneau. With two of Alaska’s six large mines in Juneau, we have many well-paying private-sector jobs. The visitor industry has returned with more cruise ship passengers than ever.”

Another trend is the shift in workforce and demographics are also reflecting a growing local income gap, Holst said.

“Our trend, just like the rest of United States, is that the rich are getting richer and the poor aren’t doing as well,” he said. “When we break it down…(looking) at our percentiles of income it’s only the top 20% that have experienced any growth in income in the last 10 years. The 80% below as a group experienced declines in overall wealth.”

Another area of struggle is housing and healthcare costs are far above average, according to a survey of municipalities that generally are of Juneau’s size or larger that was conducted by the National Chamber of Commerce, according to Holst.

“Of all of the communities that participate in this survey we are right up there at the top with the most expensive healthcare — it’s hard to say in the U.S. — but of the cities that participated in this particular analysis,” he said.

One plus is the cost of electricity in Juneau is well below the national and state averages, Holst said.

In addition to presenting the data, he conducted several instant polls asking attendees to respond using their phones to questions such as how they felt about a declining population and if they felt it was important for offspring to remain in Juneau.

Of the people responding to the latter question, 11% said it was very important descendants remain here, 53% considered it somewhat important and 37% not important.

There was far more agreement among the chamber of commerce attendees when asked “is growth a goal for Juneau,” with 82% replying yes and 18% no.

As for a future path for Juneau’s population, 60% stated they agreed “Juneau needs to embrace some growth, recognizing that we want more seniors to live here AND we want to create opportunities to maintain and/or grow our working age and younger populations.” A total of 33% stated they agreed Juneau should try to maintain its current population of 32,000, and 7% declared “having a few thousand less people suits me and our community just fine.”

During a question-and-answer session following Holst’s presentation, a few attendees agreed solving the housing shortage and cost issues are crucial to ensure a stable future population. Max Mertz, a local accountant, stated one potential way to create a strong future working population is finalizing efforts to homeport a new U.S. Coast Guard icebreaker in Juneau. Advocates say the proposal, removed at the last minute from last year’s federal budget, could result in about 600 personnel and dependants being stationed locally with several hundred million dollars in infrastructure built to support them.

But meanwhile the issue of low fertility rates and an aging population is something that needs incentives to change, said Robin Thomas, a local insurance agent.

“I think there’s no incentive to have children,” she told Holst. “You can’t afford that kid, the cost of daycare, and medical expenses and housing.”

Holst said he agrees it’s a problem and doesn’t know the solution.

“The voters did choose to add in our (local) sales tax a subsidy for childcare,” he said. “Is it going to be enough to make it affordable? I don’t think at the current levels it’s going to really change things. But it’s a step in the right direction.”

• Contact Mark Sabbatini at mark.sabbatini@juneauempire.com or (907) 957-2306.

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