Peninsula employment drops

The Kenai Peninsula has seen a steeper drop in jobs than the state in general between the first two quarters of 2015 and 2016.

In the period from January through June 2016, the peninsula had 965 fewer jobs than in the same time period of 2015, about 2.4 percent. The only industries on the peninsula that has more jobs in 2016 than 2015 are the information industry — which gained exactly one job — the financial industry, leisure and hospitality, unclassified establishments and local government, according to numbers provided to the Kenai Peninsula Borough Assembly by the Kenai Peninsula Economic Development District.

Most of the job losses came out of private industry, which has 1,027 fewer jobs in the first six months of 2016 than in 2015. Oil and gas saw the sharpest cuts — more than half of the 670 jobs directly in oil and gas extraction in 2015 were lost by the first two quarters of 2016.

The downturn in oil and gas prices worldwide has driven companies to downsize operations or withdraw. Apache Corporation withdrew from Alaska in early 2016, and ConocoPhillips is in the early stages of marketing its Nikiski LNG facility for sale. The downturn in oil and gas has impacts outside just the mining industry as well, putting pressure on oilfield support businesses. For example, Arctic Slope Regional Corporation plans to close its Nikiski fabrication facility by the end of the year in response to low oil prices, taking approximately 40 jobs out of the sector on the peninsula.

Tim Dillon, the executive director of KPEDD, presented the numbers to the borough assembly at its Dec. 6 meeting in response to discussions about a state recession. He warned that some of the numbers may look low because it does not include the boom in employment during the summer months on the peninsula.

“It does not take into consideration fishing and tourism,” he said. “You wouldn’t see that bump until you saw the third and fourth quarters.”

The peninsula’s numbers are significantly worse than the statewide numbers. In the first six months of 2016, the state had 1.6 percent fewer jobs, the greatest drop since the late 1980s recession, according to a Dec. 2 report from the Alaska Department of Labor and Workforce Development. Employment losses accelerated as well, from a 1.2 percent loss in January to a 2.5 percent decline in June, according to the report. Private sector employment losses on the Kenai Peninsula were a little less than double the statewide average of 1.9 percent, coming in at a 3.4 percent loss, according to the numbers provided by KPEDD.

Across the state, local government employment was up about .4 percent, mostly due to school district increases, according to the Department of Labor’s report. However, the Kenai Peninsula Borough School District has recently been trimming employment and has about 11 fewer full-time equivalent positions this year as compared to last year, according to an update from Superintendent Sean Dusek to the borough assembly last week.

The increase in the local government numbers for the Kenai Peninsula can be attributed to Central Peninsula Hospital and South Peninsula Hospital, both of which are borough-owned, Dillon said in an interview. Though the hospitals are both operated by nonprofit boards, their employment numbers were included in the local government numbers because they are still public hospitals.

The Kenai Peninsula Economic Development District provides support for businesses on the peninsula through research, advice and can provide small loans. Dillon said employers on the peninsula are working on processing the economic situation the state is faced with.

“At this stage, I think people are just trying to digest things,” he said. “They been hearing this is where we’re headed, so what do we do?”

The Kenai Peninsula Economic Development District is preparing to host its annual Industry Outlook Forum on Jan. 11, in which employers, government officials and entrepreneurs will speak on the economic outlook for the coming year. One of the major changes is that the typically two-day event will be condensed into a single day this year. Dillon said the organization chose to shorten the event to one day to make sure people could find time to come.

“One of the big things that I heard last year was, ‘I can give you one day but I can’t give you two days,’” he said. “We’re in different economic times right now, and if you want those key people to not only go ahead and make the presentations but also be in the audience, you have to make those adjustments.”

Kenai Peninsula Borough Mayor Mike Navarre will provide an update on the borough, and a panel of members from the Alaska Department of Labor, Kenai Peninsula College, the Kenai Peninsula Borough School District, the Kenai Peninsula Construction Academy and Alaska’s Institute of Technology in Seward will provide a workforce outlook. Alaska Travel Industry Association President and CEO Sarah Leonard and Shanon Davis of the Kenai Peninsula Tourism Marketing Council will provide a tourism industry update, Kenai Peninsula Borough Healthcare Task Force chairman Rick Ross will provide a health care industry peninsula-wide update and Kenai Peninsula Borough Assembly member Brandii Holmdahl, who also works for seafood processor Icicle Seafoods and has family who works in the sportfishing industry, will provide a fishing industry update. Other speakers include the Kenaitze Indian Tribe’s Wellness Director Deborah Nyquist, Alaska Miners Association Executive Director Deantha Crockett, Alaska Oil and Gas Association President and COO Kara Moriarty, and former Lt. Gov. Mead Treadwell as well as three local Kenai Peninsula entrepreneurs throughout the day.

Dillon said he felt confident in the diversity of the speaker lineup this year.

“This way, we can get a better feel for what’s going on statewide,” he said.

Those wishing to attend can register on kpedd.org.

Elizabeth Earl is a reporter for the Peninsula Clarion. She can be reached at elizabeth.earl@peninsulaclarion.com.

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