Here are the economic indicators for Alaska presented by Mark Edwards, Northrim Bank vice president and chief economist, at the bank’s economic forum luncheons. The data indicates an economy that is leveling out and poised for growth. However, proposed large state budget cuts could extend or even deepen the recession, said Mouchine Gettabi, economist at the University of Alaska’s Institute of Social and Economic Research, who also presented at the Northrim forum.
Here are key points:
From Mark Edwards:
Macro indicators: Employment was up 0.1 percent in February after three years of declines; oil and construction, both high-wage industries, are leading the rebound. Per-capita income rose 4.4 percent in 2018, and at $59,687 was 10th best among the states and 11 percent above the national average. Average home sale prices gained 2.3 percent in Anchorage in 2018. However, the state experienced a 0.2 percent population decline, or 1,608 people. Inflation was up in 2018 at 3 percent after being at 0.6 percent over the last three years.
Mortgage delinquencies: Mortgage loan delinquencies on one-to-four unit residential loans aver- aged 2.92 percent in 2018, down from 3.37 percent in 2018 and actually lower than the per-recession 2014 rate of 2.95 percent. The Alaska rates compare favorably with the U.S. 2018 average delinquency rate of 4.32 percent.
Foreclosures: Home foreclosures averaged 0.66 percent of total loans in 2018, comparing favor- ably with the 0.95 percent national rate for 2018. The Alaska 2018 rate was also below the Alaska pre-recession 2014 foreclosure rate of .8 percent of loans.
Building permits: Total Alaska building permits totaled 1,698 in 2018, surpassing the 2014 level before the recession and almost double the 868 permits issued in 2011.
From Mouhcine Guettabi:
- After 39 consecutive months of recession, the state has lost 11,300 jobs.
- The state FY 2020 deficit is projected at $1.62 billion, but this assumes a $3,000 Permanent Fund Dividend. If the $1.944 billion for the PFD were not paid, the state budget would be in surplus.
- The loss of jobs in the economy due to the budget cuts of state, local and federal funds would result in 16,924 jobs, ISER estimates. The positive effect of a $3,000 PFD is difficult to calculate (there is little data) but ISER estimates there could be gains of 696, although most of these would be in temporary retail.