Nearly a third of the Alaska's economy is tied in some fashion to oil and gas, said Neal Fried, writing in the latest issue of Alaska Economic Trends, a monthly publication from the Alaska Department of Labor and Workforce Development.
State data shows that oil and gas production accounts for 29 percent of Alaska's Gross State Product, a measurement similar to the Gross National Product but confined to production of all kinds occurring in the state. The next largest portion of the GSP pie is government, which accounts for 18 percent. Transportation and utilities (listed as a single category) and financial activities are next, each at 10 percent.
While its production ranks highest for the GSP measurement, the oil and gas industry only accounts for about 4 percent of the state's total workforce, making it "a relatively small employer with a big roar," according to Fried.
Revenues from oil and gas make up 88 percent of the state's general fund unrestricted revenue, Fried said. Some estimates indicate the revenue stream from oil could reach $10 billion to $14 billion this year, he added.
That kind of money will contribute mightily to the rapidly growing Alaska Permanent Fund, which has dispersed about $15 billion in dividends to Alaska residents since that program launched in 1982.
The industry also is one of the largest property taxpayers in the state. Many local communities, including the Kenai Peninsula Borough, its cities and service areas benefit directly from that tax stream. According to the FY 2009 Kenai Peninsula Borough budget, property taxes on the oil industry will generate more than $6.46 million this fiscal year, about $2.86 million of that going to the borough's general fund.
As of June, oil and gas employment hit 12,600 in June. That included workers in oil and gas extraction, those working drilling rigs and gas wells, and oil and gas support companies.
Jobs within the industry have grown despite a general decline in production since the peak in 1988, when production was roughly 2.1 million barrels per day. Employment continued to grow, however, hitting about 10,700 in 1991.
Production now amounts to about 750,000 barrels a day. Employment, too, declined in the 1990s as oil prices fell. In 2000, industry watchers declared Alaska's oil industry to be entering its "mature" stage.
Employment continued to fall, reaching a low of about 8,000 by around 2003, Fried noted.
By then, oil prices were in recovery and on their way to record highs. By 2006, employment was rising significantly again, and by June 2008 stood at about 12,600.
Most of the industry's workforce, about 90 percent, labors on the North Slope, in Anchorage and on the Kenai Peninsula, which has about 10 percent of the total.
Those employees work in oil and gas production, pipeline transportation, a liquid natural gas facility and an oil refinery. Together, they represent about 7 percent of the wage and salary employment within the Kenai Peninsula Borough. But, said Fried, because oil industry wages are so high, those jobs also represent about 12 percent of the total payroll within the borough.
Hal Spence is a reporter for the Peninsula Clarion.
|
|
• Advanced Search • Classifieds |
Homer Alaska - Business -
Story last updated at
10:09 PM on
Wednesday, September 17, 2008
Economist: Alaska's oil-gas industry healthy
By HAL SPENCE
Morris News Service - Alaska
|
|
|
| E-mail this Story to a friend |
Send a message to the editor |
Have our Headlines sent to you |
