Federal civilian jobs bring in $1 billion per year to Alaska

Editor’s note: The October 2013 edition of Alaska Economic Trends, a publication of the Department of Labor and Workforce Development, has a timely look at federal employment in the state. The following articles are reprinted with permission.

The federal government has always played a leading role in Alaska’s economy, especially before statehood when it ran the territory. Although the size of the federal workforce has waxed and waned in recent history, the federal government’s presence here in terms of its share of jobs is still fourth-largest in the nation after Washington, D.C.; Maryland; and Hawaii.

The military is big in Alaska, but the smaller civilian piece of federal employment is significant on its own. It made up 4.9 percent of Alaska jobs and paid 7.2 percent of wages in 2012 — more than $1 billion. (See the sidebar on the next page for more on Alaska’s federal workers, including how much they make.)

26 percent are in national security

The military has 23,237 personnel in Alaska, and the federal civilian workforce stands at 16,390. But many of those civilian jobs also serve the military and are directly tied to the state’s bases. Partly because of the large military presence, national security is the largest percentage of federal civilian jobs — 26 percent in 2012 — all of which are handled by the largest department, the Department of Defense. (See exhibits 1 and 2.)

The Department of Defense represents 32 percent of civilian federal jobs, followed by the Department of the Interior — which includes the Bureau of Indian Affairs, U.S. Fish and Wildlife Service, and the Bureau of Land Management — at 16 percent. The Bureau of Land Management is particularly significant in Alaska because 60 percent of Alaska’s land is federally owned. BLM deals with much of the state’s land conservation, land transfers and management (including trail maintenance and campgrounds), firefighting, and oil and gas leasing.

Coming in third and fourth for jobs were the Department of Agriculture and the Postal Service, respectively.

The federal government’s various branches specialize in a range of services, such as health care, social services, retail, and tourism. (See Exhibit 1.)

Retail and tourism-related jobs made up 5 and 8 percent of federal employment respectively in 2012. Some of these jobs support the state’s military population while others serve tourists in places such as Denali National Park and Klondike Gold Rush National Historic Park near Skagway.

Jobs all around the state

Every Alaska borough and census area has federal positions, but some rely more on the U.S. government than others. Not surprisingly, Anchorage had the largest number of federal jobs — 9,117 in 2012 — but the federal government has a bigger financial impact on many smaller areas and is often a larger percentage of a rural area’s economy. (See Exhibit 3.) For example, the federal government paid over 17 percent of all wages in the Denali Borough and over 25 percent in the Hoonah-Angoon Census Area last year, and none of those jobs were tied to the military. Another area with a large percentage of federal civilians is the small Southeast Fairbanks Census Area, with jobs mainly tied to Fort Greely.

The Haines Borough had the fewest federal jobs at just 10 in 2012. These were mostly with the Postal Service, with a handful in customs and border control.

Federal employment trends

The federal government makes its mark in Alaska’s regional economies of all sizes because of its variety of services, high wages, and broad geographic presence, but its influence has fluctuated over the years. Overall, its employment numbers have been fairly steady since the mid-1990s, but the last two decades have been marked by a couple of major economic changes. (See Exhibit 4.)

Federal employment peaked in the early 1990s when a small increase in the infantry division at Fort Wainwright and greater construction spending created more civilian jobs, but budget cuts in the late ‘90s brought those levels back down.

The sharp losses tapered into more of a slow leak and then evened out until another smaller jump in employment in 2010. This increase came with the creation of temporary positions to conduct the 2010 Census, but those jobs disappeared quickly thereafter and since 2010, federal job levels have continued to decline each year. The 2012 job count of about 16,300 is significantly lower than the 1993 peak of around 20,000.

In 2013, Alaska is forecasted to lose another 300 federal jobs. Some of the recent losses are likely tied to the military — though the size of the state’s active duty military has increased overall since 2000, it too has declined slightly in recent years, resulting in cutbacks to civilian employee budgets on and off military installations.

10/03/2013 - 6:50am