Economic Plan

2025Southeast Alaska

SOUTHEAST CONFERENCE

Economic Development Committee

Southeast Alaska Economic Plan 2020

CEDS

TRANSPORTATION

ENERGY

MARITIME

SEAFOOD

MINING TOURISM

TIMBER

CEDS Steering

Committee

HEALTH CARE

Southeast Conference Committees

TRANSPORTATION

ENERGY

MARITIME

ECONOMIC DEVELOPMENT

MINING TOURISM

TIMBER

CEDS Steering

Committee

HEALTH CARE

Southeast Conference Committee

Chairs

Timeline: Where are we in process?

SWOT & Committee

Economic Analysis

Goals & Objectives

Action Plan Review

Draft Plan

You Are Here

Priority Objectives

Resiliency

May 2020

March 2021

Visitor Industry Market Southeast Alaska to Attract More Visitors. Improve Access to Public Lands. Increase Flexibility in Terms of Permit Use. Increase Yacht and Small Cruise Ship Visitations. Improve Communications Infrastructure. Advocate for Adequate Funding to Maintain Existing Recreational

Infrastructure.

Timber Industry Provide an Adequate, Economic and Dependable Supply of Timber

from the Tongass National Forest to Regional Timber Operators. Stabilize the Regional Timber Industry. Work With USFS to Direct Federal Contracts Toward Locally-Owned

Businesses. Support Small Scale Manufacturing of Wood Products in Southeast

Alaska. Continue Old Growth Harvests Until Young Growth Supply is

Adequate. Community-Based Workforce Development. Update Young Growth Inventory.

Other Objectives Housing: Support Housing Development. Food Security: Increase Production, Accessibility, and Demand of

Local Foods. Communications: Improved Access to Telemedicine in Southeast

Alaska. Marketing: Market Southeast Alaska as a Region. Solid Waste: Regional Solid Waste Disposal. Arts: Increase Recognition of Southeast Alaska’s Thriving Arts

Economy. Mining: Minerals & Mining Workforce Development. Attract Research Jobs. Research: Attract Science and Research Jobs to Southeast Alaska. Cultural Wellness: Support Development of Activities and

Infrastructure That Promote Cultural Wellness.

Transportation Minimize Impacts of Budget Cuts to AMHS and Develop Sustainable

Operational Model. Road Development. Move Freight to and from Markets More Efficiently. Ensure the Stability of Regional Transportation Services Outside of

AMHS.

Energy Work with Federal and State Government to Promote Regional

Energy Projects. Diesel Displacement. Support Community Efforts to Create Sustainable Power

Systems That Provide Affordable/Renewable Energy. Complete Regional Hydrosite Evaluation for Southeast Alaska.

Maritime Maritime Industrial Support

Maritime Industrial Support Sector Talent Pipeline: Maritime Workforce Development Plan.

Increase Access to Capital for the Regional Maritime Industrial Support Sector.

Harbor Improvements. Examine Arctic Exploration Opportunities That the Region

as a Whole Can Provide.

Seafood Industry Mariculture Development. Full Utilization and Ocean Product Development. Increase Energy Efficiency and Reduce Energy Costs. Regional Seafood Processing. Seafood Markets. Sea Otter Utilization and Sustainable Shellfish. Maintain Stable Regulatory Regime.

Promote strong economies, healthy communities, and a quality environment in Southeast Alaska.

Southeast Alaska 2020 Plan: 46 initiatives

Other Objectives • Housing • Food Security • Communications • Solid Waste • Arts • Research • Cultural Wellness

Economic Development Committee: “other”

Alaska Mariculture

Initiative

AMHS Reform Project

Market Southeast Alaska to Visitors

Maritime Workforce

Development

Full Seafood Resource Utilization

Secure Adequate

Timber Supply

Diesel Displacement

7Priority

Objectives

TRANSPORTATION

ENERGY

MARITIME

SEAFOOD

TOURISM

TIMBER SEAFOOD

Priority Objectives

Key Project Champion Who will be the project champion moving this project forward?

Outline of steps required for project to be completed. List steps and dates

People/Organizations responsible for completing these steps Who will be working on this?

Cost Estimates How much will this cost, and who will pay these costs?

Evaluation Measures What are the indicators we can track that will measure project success?

Committee MeetingsSoutheast Alaska Comprehensive Economic Development Strategy

Meeting Schedule

Month Transportation Energy Timber Seafood Health Care

Tourism Mining Econ Devel.

Feb 2020 (or earlier)

April/May 2020

June/July/Aug 2020

September 2020

Oct/Nov/Dec 2020

February 2021

Sector SWOT Analyses

April/May 2020

The Southeast Alaska sector SWOT analyses were conducted by the Southeast Conference Committees in two sessions: On February 4th, 2020 at Mid Session Summit, and again in April or May. Once the SWOT

lists were completed by the group, committee members were asked to prioritize by choosing the top two to three items that

they felt were most representative of regional timber strengths, weaknesses,

opportunities, and threats.

Natural Beauty

Unique Destination

Jobs

Growth potential

0.4 0.8

43%

45%

52%

76%

StrengthsCommunity relationships/

Infrastructure

Seasonality of industry

Seasonal housing

0.35 0.7

27%

38%

48%

67%

Cultural Tourism/

Community Collaboration and Planning

Independent/niche tourism development

Better Tourism Marketing

0 0.44

29%

31%

33%

43% COVID-19/Illness

Anti-tourism sentiment

State/Fed regulations (or lack of)

Increasing Costs0 0.45 0.9

30%

33%

35%

89%

Weaknesses

Opportunities Threats

communication

Collaborate with Alaska Native Entities

Southeast Alaska SWOT Tourism

Provides quality/high paying jobs

Supports regional economy

High environmental standards

Abundant mineral resources

0.5 1

35%

57%

64%

100%

StrengthsExtreme opposition

Negative public perception

Aging/insufficient infrastructure

Finite resource/mine life

0.35 0.7

25%

29%

50%

64%

Explore/develop new mineral

Public outreach/educate on value

Workforce Development/Increased jobs

Increase access into Tongass

Small to medium sized mine development0 0.8

29%

29%

43%

57%

71% Environmental groups/lawsuits

New regulations/permits/uncertainty

Lack of skilled workers

Federal management/bureaucracy0 0.45 0.9

29%

29%

57%

86%

Weaknesses

Opportunities Threats

by environmental groups

deposits & expand existing mines

Mining SWOT Analysis

Strong, reliable airline services

Barge services

Tourism support/integration

Communication/partnerships

Alaska Marine Highway

IFA ferry services0.25 0.5

24%

24%

25%

29%

38%

48%

StrengthsAMHS funding/service cuts

Lack of regional transportation plan

Small population/low economy of scale

AMHS not reliable

Not enough exports/lack of backhaul

AMHS politics0.35 0.7

21%

24%

29%

35%

57%

62%

Improve AMHS services/efficiency

Regional transportation plan

New ferry service model

New road development

Better connections to Canada

Tourism integration0 0.7

19%

23%

29%

31%

33%

67%Demise of AMHS

Loss of state funding

Loss of political support for Southeast

Misconception of AMHS value

Regional population/economic decline0 0.3 0.6

26%

29%

33%

38%

52%

Weaknesses

Opportunities Threats

Transportation SWOT Analysis

High quality product

Sustainable

Great reputation/

Hatcheries

0.3 0.6

28%

49%

59%

60%

StrengthsClimate/ocean change

Transportation expensive

Trade/tariff impacts

Workforce limitations

0.35 0.7

32%

33%

39%

68%

Increase value added

Mariculture

Seafood waste utilization

Marketing innovation

0 0.6

36%

38%

50%

56% Global/ocean warming/

Trade wars/barriers

COVID-19

Aging fleet/infrastructure0 0.45 0.9

29%

36%

64%

83%

Weaknesses

Opportunities Threatsacidification

Alaska brand/Origin story

& challenging

Seafood SWOT Analysis

Abundant Hydropower

Biomass Availability

Innovative

Resilient (not in grid)

0.5 1

20%

20%

24%

96%

StrengthsHigh costs of infrastructure

Small loads/demand

Lack of connectivity between grids

Aging infrastructure

0.4 0.8

24%

32%

42%

76%

Expand regional Intertie

New Hydro development

Install more heat pumps

Expand electric vehicle use/

0 0.48

28%

32%

44%

48%Economic downturn

Shrinking population/

Climate Change/Drought

Loss of PCE0 0.3 0.6

38%

40%

48%

52%

Weaknesses

Opportunities Threats

powering locations

energy loads

Energy SWOT Analysis

High quality timber/products

Sustainable/renewable resource

Supports rural SE economies

High paying good jobs

0.3 0.6

43%

43%

50%

57%

StrengthsEnvironmental groups/litigation

Cost of doing business

Federal regulations/bureaucracy

Workforce limitations

0.4 0.8

43%

57%

57%

79%

Increased private/state lands

Telling the positive story of timber

Develop niche markets

Federal land exchanges

0 0.6

36%

36%

43%

57% Environmental groups

2016 Forest Plan

Federal Bureaucracy

Roadless Rule0 0.35 0.7

29%

50%

50%

64%

Weaknesses

Opportunities Threats & Lawsuits

Timber SWOT Analysis

Strengths Weaknesses

Opportunities Threats

High % of Population has Health Care Access Diverse Rural Services Recreation is workforce draw Capacity Collaboration Technology Personalized Care

State Budget Cuts Transportation Costs Higher Costs Lack of Efficiency Lack of Specialty Care Substance Abuse Recruitment Increased Costs Technology integration Senior Care Capacity/Services Lack of Collaboration

University Course Development Strategic Investment Behavioral Health Curriculum Expansion Health Care Career Pathways Improved Technology Use Online Coursework Follow Best Practices for Remote Care Build Regional Alliances

Lack of understanding regarding the seriousness of the health care situation

State Medicaid budget reductions. There is a lack of regional vision Unwillingness to change High costs of health care Competition with outside employers. Shrinking population Access to health care/insurance

Health Care SWOT Analysis

The Southeast Alaska Strengths, Weaknesses, Opportunities, Threats

(SWOT) analysis was developed by more than 200 Southeast Conference members, including business, municipal, and tribal

leaders from across the region in February 2020.

Beauty and Recreation Opportunities

Tourism Sector

Seafood Industry

Rich Alaska Native Culture and Heritage

People and Southeast Alaskan Spirit

Great place to raise kids/families0.25 0.5

34%

36%

37%

38%

41%

50%

StrengthsFerry transportation decline

Cost of living and doing business

Transportation Costs

Housing: Not enough/Too Expensive

Aging or lack of infrastructure

Dependence on State oil economy0.3 0.6

22%

26%

32%

34%

42%

59%

Strengthen ferry connectivity

Mariculture development

Seafood products development

Cultural tourism development

Renewable energy

Improve infrastructure0 0.6

22%

23%

28%

31%

43%

50%Reduction/loss of Ferry Service

Fisheries decline

Poor leadership/decision making

Cost of living

Climate Change/Global Warming

Capitol move/capital creep0 0.3 0.6

28%

29%

33%

34%

34%

54%

Weaknesses

Opportunities Threats

Southeast Alaska SWOT Analysis

Beauty and Recreation Opportunities

Tourism Sector

Seafood Industry

Rich Alaska Native Culture and Heritage

People and Southeast Alaskan Spirit

Great place to raise kids/families

Wildlife

Clean Water

Access to Natural Resources

Mining0.25 0.5

20%

22%

28%

30%

34%

36%

37%

38%

41%

50%

Southeast Strengths

Ferry transportation decline

Cost of living and doing business

Transportation Costs

Housing: Not enough/Too Expensive

Aging or lack of infrastructure

Dependence on State oil economy

Energy Costs

Lack of road connectivity

Lack of jobs that can support household

Seasonal jobs instead of year-round

Lack of childcare0.3 0.6

15%

17%

18%

20%

20%

22%

26%

32%

34%

42%

59%

Southeast Weaknesses

Ferry connectivity strengthened

Mariculture development

Seafood products development

Cultural tourism development

Renewable energy

Improve infrastructure

Housing development

Maritime industry growth

Diversify the Economy

Grow food & harvest plants

Mining industry0 0.6

18%

20%

21%

21%

21%

22%

23%

28%

31%

43%

50%

Southeast Opportunities

Loss/Further Reduction of Ferry Service

Fisheries decline

Poor leadership/decision making

Cost of living

Climate Change/Global Warming

Capitol move/capital creep

State jobs/budget cuts

Declining/aging population/loss of youth

Radical outside groups/lawsuits

Housing related0 0.3 0.6

15%

18%

18%

23%

28%

29%

33%

34%

34%

54%

Southeast Threats

Timeline: Where are we in process?

SWOT & Committee

Economic Analysis

Goals & Objectives

Action Plan Review

Draft Plan

You Are Here

Priority Objectives

Resiliency

May 2020

March 2021

Southeast Alaska April Jobs 2020

-0.4 -0.3 -0.2 -0.1 0 0.1

8%0%0%

-7%-8%

-9%-10%-10%

-11%-12%

-14%-22%

-26%-38% Leisure & Hospitality

Seafood Processing

Transportation

Construction

State Gov’t

Health Care

Financial

Tribal Gov’t

Local Gov’t

Retail Trade

Professional Services

Mining and Logging

Information

Federal Gov’t

-1,300

-700

-200

-200

-600

-300

-100

-100

-600

-

-300

-300

+100 +

Between April of 2019 and April of 2020 Southeast Alaska lost (at least temporarily) 13% of all jobs, a reduction representing 4,600 lost workers due to the COVID-19 crisis. The hardest hit were the leisure & hospitality and transportation sectors. These saw a combined decline of 2,000 jobs. Federal jobs increased by 100 (mostly part-time, temporary Census workers). The mining, logging, and information sectors experienced no changes in workforce levels during April.

CO

VID-19 Im

pacts 2020Change in SE Jobs: April 2019 to April 2020 = -4,600

Source: Alaska Department of Labor Monthly Employment Statistics

+11.1% +7.4% +7.6% +19.7% +18.7% +4.5% +10.5% +6.7% +7.1% +2.7% +8.7% +6.2% +3.0%

Southeast Alaska April Unemployment 2020

United StatesAlaska

Southeast AlaskaSkagway

HainesHoonah-Angoon CA

KetchikanPetersburg

WrangellPrince of Wales-

SitkaJuneauYakutat

0 0.1 0.2 0.3 0.4

9%10.8%

12.8%13.6%

14.7%15.5%

17.3%18%

27.3%31.4%

13.8%13.7%14.4%

CO

VID-19 Im

pacts 2020

Change in SE Unemployment: April 2019 to April 2020 = +7.6%

Source: Alaska Department of Labor April 2020 Preliminary Unemployment Rates

Unemployment Rate April 2020 Increase since April 2019

Hyder Census Area

Between April of 2019 and April of 2020 the Southeast Alaska unemployment rate jumped 7.6% from 6.2% to 13.8%. Skagway and Haines saw the greatest increases, while the POW Census Area and Yakutat experienced the smallest.

Economic PlanSoutheast Alaska

SOUTHEAST CONFERENCE

Questions?Meilani Schijvens Rain Coast Data

Southeast Alaska Annual Business Confidence

and Investment Survey

Developing 2020 Survey

Business Confidence: CurrentlyHow do you view the regional business climate right

now?

Very Poor6%

Poor38%

Don't know1%

Very Good5%

Good50%

Very Poor5%

Poor34%

Don't know2%

Very Good5%

Good54%

2019 +4%2018

Business Confidence: OutlookWhat is the economic outlook for your

business or industry over the next year?

Much Worse2%

Worse14%

Same (poor)18%

Same (positive)37%

Much Better2%

Better27%

2018

Much Worse1%

Worse13%

Same (poor)18%

Same (positive)38%

Much Better5%

Better25%

2019 +1%

Jobs Outlook

Reduce Jobs11%

Unknown12%

Add Jobs27%

Maintain Jobs51%

Over the next year, do you expect your

organization to add jobs,

maintain, reduce jobs, unsure

Annual Business InvestmentLess than $5,000

$5,000 to $10,000$10,001 to $25,000$25,001 to $50,000

$50,001 to $100,000$100,001 to $500,000

$500,001 to $1,000,000$1,000,001 to $5,000,000$5,000,001 - $10,000,000

$10,000,001 - $20,000,000$20,000,001 - $30,000,000

$30,000,000+0% 1400% 2800% 4200%

2124

1510

3325

3317

2841

$221 Million

Which questions should we add for 2020?

1. How many people does your business currently employ?

2. How many people does your business employ during the summer peak?

3. Have you experienced any disruption in business due to COVID-19?

4. Please estimate the percent revenue decline to your business due to COVID-19 in the last 30 days (compared to same period in 2019)?

5. How much do you project your revenues will change in the first half of 2020 compared to 2019?

6. How many employees have you laid off (or put into unpaid status) so far due to COVID-19?

7. Do you expect to make employment cuts in the future due to COVID-19?

8. Has your supply chain been disrupted?

9. Have you experienced disruptions from vendors and service providers?

10. Is your business at risk of closing permanently because of impact caused by COVID-19?

11. If you are at risk of closing, how many weeks of the current situation do you think you will be able to survive?

SEC COVID-19 Impacts Survey (March)

• Business name• # of employees• # of part time versus full time• Check all the benefits your business offers; medical,

dental, vision, retirement, paid leave, mat leave etc. • Select your primary revenue source; tourism, local,

transportation, goods and supplies etc. • Does your business have reserves or emergency

funds• Projected revenue in FY20• Projected lost revenue FY20• Check all the impacts that apply; layoffs,

cancellations, lost revenue, reduction in employee benefits, etc.

• Immediate needs; resume tourism ops, financial assistance, etc.

Submitted Questions