According to a recent report released by the Alaska Department of Labor and Workforce Development, the state’s population is projected to increase by 162,200 over the next 30 years. This seemingly good news contrasts with our $4 billion budget deficit and this week’s headline about BP sharply curtailing drilling operations in Prudhoe Bay. Are we headed for a recession and our first annual job loss in seven years, or are we really going to grow?
The report does come with caveats since unforeseen events can occur — dramatically altering projections — but it is an attempt to predict the range of possibilities over a longer term given Alaska’s historical population data and fertility, mortality and migration rates. It uses Alaska’s population of 737,625 in July 2015 as the starting point.
This is important and timely information for our government policy makers, commercial business leaders and planners from every sector of our economy. But the real value of the report becomes apparent when you drill down into the numbers. After doing that, you will find that the Anchorage and Matanuska-Susitna regions are predicted to grow the fastest — with the Mat-Su Borough projected to grow over 80 percent by 2045.
While Matsu planners will be confronting some interesting challenges, the Southeast region will be facing its own unique set of challenges. Unfortunately, it is the region in the state with the lowest population change by far — only growing .3 percent over the next 30 years (initially the report reflected a population decrease but was adjusted later to show a small increase). This equates to an average increase of less than nine residents per year in our region. Of particular concern is the majority of cities in our region (including Juneau) begin with or eventually revert to a pronounced downward population trend.
Every other region in the state is projected to grow by double-digit percentages over the same time period. While within our region, Juneau’s population is projected to grow 5.3 percent, that is still anemic compared to many other cities in Alaska. As a region, this demographic tsunami will have far reaching implications politically and economically.
As our regional representation in the Legislature continues to weaken through redistricting, we will have even less influence in determining the direction of state government policies, protecting Juneau’s role as a capital city as well as garnering support for our ferry system.
But, just as important, lack of healthy population growth and the inevitable aging of our residents severely limits the human and financial resources we need for our economy to grow and prosper.
This can lead to labor and critical skill shortages and underutilization of public facilities such as schools, libraries and recreational facilities. Decisions to cut back services and close or downsize facilities will be continually evaluated as an ever-increasing tax burden is spread proportionally in higher amounts over fewer (and older) citizens.
We all hope lower oil prices will be short-term in nature and after some belt tightening, we would see a healthier economy return. But these longer term projections don’t seem to indicate that for Southeast.
Since these projections are based on past trends, they can change. However, if we keep doing things the way we’ve always done them, my guess is our region and our community will continue to labor under an economy with little to no growth.
The state and our region face tough times ahead and very hard decisions must be made. Cutting spending will be part of the equation and revenue-raising measures must be considered. But neither of those strategies will get us through this period and beyond without responsible and serious economic development.
Unfortunately, nearly every proposed economic development or infrastructure project runs into opposition regardless of its merit. Yet these projects will diversify, stabilize and grow our economy when the alternative is raising taxes and increasing our dependence on government.
If our community focuses more on building public parks and seawalks instead of promoting projects that create jobs and economic opportunity, nothing will change.
Juneau has a reputation in other parts of the state for being anti-development. We need to change that perception. Gearing up for a protracted legal battle with the cruise industry — one of Juneau’s economic mainstays — by refusing to consider settlement negotiations is very short-sighted and sends the wrong message to the business community at large.
Making the change to encourage real economic activity is critical. This creates more jobs and population growth which translates into more families with children using our schools, hospital, and city services as well as individuals and businesses paying real estate and sales tax to help support our community.
And, yes, a faster, more convenient, less expensive road connection in northern Lynn Canal would help make all that happen as well.
• Win Gruening retired as the senior vice president in charge of business banking for Key Bank in 2012. He was born and raised in Juneau and graduated from the U.S. Air Force Academy in 1970. He is active in community affairs as a 30-plus year member of Juneau Downtown Rotary Club and has been involved in various local and statewide organizations.
