2009 economic forecast update & three -year outlook
TRANSCRIPT
Mid-Year 2009 Forecast Update
• Solid growth in 2008• Predicted 100 fewer
jobs in 2009, a <0.01% decline
• January through June 2009 average employment up 850 jobs (+0.6%) over same period in 2008
2001 2002 2003 2004 2005 2006 20072008EST2001 2002 2003 2004 2005 2006 2007
2008EST
ANCHORAGE EMPLOYMENT2001-2008, 2009 Estimate
Government Sector
• Predicted no new jobs in 2009
• 720 more jobs during the first six months of 2009, compared to the same period 2008
2001 2002 2003 2004 2005 2006 20072008EST
ANCHORAGE GOVERNMENT EMPLOYMENT
Excluding Uniform Military Personnel2001-2008, 2009 Estimate
Oil and Gas Sector
• Predicted no change in 2009
• 70 fewer jobs during the first six months of 2009, compared to the same period 2008
2001 2002 2003 2004 2005 2006 20072008EST2001 2002 2003 2004 2005 2006 2007
2008EST
ANCHORAGE OIL INDUSTRY EMPLOYMENT
2001-2008, 2009 Estimate
Other Sectors
• So far, losses felt in several sectors-220 jobs in wholesale and retail trade
-120 jobs in air transportation
-150 jobs in leisure & hospitality
-320 jobs in construction
• Health care (up 520 jobs) and business & professional services (up 230 jobs) job growth strong, but may taper off by year’s end
Looking Forward Three Years
Take a look at the “Big Picture” and consider the forces shaping the Anchorage economy: Where are these forces taking us?
Population Growth
• Population grew average of 1.1% annually over the past decade
• 0.9% growth in population 2007-2008
• Population projected to grow 0.5% annually from 2009-2012
2001 2004 20072011EST
ANCHORAGE POPULATION2000-2008, 2009-2012 Projections
2001 200220032004 2005200620072008EST
2009EST
2011EST
2010EST2000
Employment
• 20th year of consecutive growth in 2008 (+1.7% over 2007)
• Employment expected to be flat in 2009 and 2010 with a slow growth trend between 0.5- 1% annually in 2011 and 2012
ANCHORAGE EMPLOYMENT2001-2008, 2009-2012 Projections
2001 2002 2003 2004 2005 2006 20072008EST
2009EST
2011EST
2010EST
Personal Income
• Anchorage residents earned $12.8 billion in personal income in 2007, up 5% since 2006
• Growth is forecast to slow in the next three years-- Slower employment
growth-- Decreasing
investment returns-- Lower business
profits
ANCHORAGE PERSONAL INCOME2001-2007, 2008-2012 Projections ($Billion)
2001 2002 2003 2004 2005 20062007EST
2008EST
2009EST
2011EST
2010EST
Building Permit Values
ANCHORAGE BUILDING PERMIT VALUES2003-2008, 2009-2012 Projections ($ Million)
• Residential and commercial permit values down, and government permits are up in the first 5 months of 2009 over the same period 2008
• Total building permit values in 2009-2010 will remain static, with slow growth (1 to 2%) in 2010 and 2012
Anchorage Air Passenger Traffic
• Traffic has declined in 2009, down 10% in the first five months 2009 compared to the same period 2008
• Traffic is expected to recover in 2010, 2011 and 2012, at an annual rate of 1%
ANCHORAGE PASSENGER VOLUME2003-2008, 2009-2012 Projections (Millions)
2001 200220032004 2005200620072008EST
2009EST
2011EST
2010EST2000
Anchorage Air Cargo Volume
• Cargo volumes have declined significantly in 2009, down 35% in the first five months 2009 compared to the same period 2008
• Modest recovery is expected in 2010 through 2012 with 2% annual growth
ANCHORAGE AIR CARGO VOLUME2003-2008, 2009-2012 Projections (Thousand Tons)
2001 200220032004 2005200620072008EST
2009EST
2011EST
2010EST2000
Port of Anchorage Freight Volume
• Volume down from peak in 2005
• 9 cruiseship stops in 2010
• Volume expected to decline 5 percent in 2009 and moderately increase (5 to 8% annually) in 2010 to 2012
PORT OF ANCHORAGE FREIGHT VOLUME2000-2008, 2009-2012 Projections (Thousand Tons)
2001 200220032004 2005200620072008EST
2009EST
2011EST
2010EST2000
Visitor Industry
• Early indicators for 2009 season show decline:-- Anchorage air traffic is down-- Projected cruise visitation is flat-- Alaska Highway border crossings are down
• Convention business may weaken in 2010, but recover in 2011 and 2012
• With Anchorage as a new port of call, local businesses will benefit from cruise passenger spending
Oil Prices
• Oil prices expected to hold steady around current prices for the rest of 2009
• In the long-term, as economies recover, oil prices are expected to increase; yet remain below 2008 record levels
ANNUAL AVERAGE CRUDE OIL PRICES2000-2008, 2009-2012 Estimates ($Barrel)
2001 200220032004 2005200620072008EST
2009EST
2011EST
2010EST2000
In Closing
• Overall, Anchorage’s economy is expected to be flat in 2009 and 2010
• Some sectors will experience growth, while others will experience declines in 2009
• Economic recovery is expected in 2011, gaining momentum in 2012