Ties that Bind The Enduring Economic Impact of Alaska on the Puget Sound Region McDowell Group, Inc. Seattle Propeller Club March 18, 2015
McDowell Group Research and consulting since 1973 15 professional staff Offices in Juneau, Anchorage, Bellingham Areas of expertise: mining, oil & gas, tourism, seafood, transportation, health care, education Services: economic and socioeconomic analysis, surveys, market research, feasibility studies, community planning, program evaluation
About Ties That Bind Previous reports: 1985, 1994, 2003 Six counties: King, Kitsap, Pierce, Snohomish, Skagit, Whatcom Sources: government agencies, industryspecific impact reports, McDowell Group data, interviews, business survey IMPLAN for economic impact analysis
Sponsors Presenting Sponsor Alaska Airlines Gold Sponsors Lynden Transport, Inc. Port of Seattle Port of Tacoma Shell Oil Company Totem Ocean Trailer Express Silver Sponsors Alaska Oil & Gas Association Banner Bank Foss Maritime Company GCI ConnectMD Jones Stevedoring Co. Bronze Sponsors Alaska Railroad At sea Processors Association Manson Construction Port of Anchorage Schnitzer The Wilson Agency / Albers & Company, Inc. Transportation Institute U.S. Bank Supporting Sponsors Alaska Salmon Alliance Fifth Third Bank Nexus Northwest Co Presenters Seattle Metropolitan Chamber of Commerce Alaska Chamber of Commerce Tacoma Pierce County Chamber of Commerce
Economic Impact Economic Impacts Alaska Related Jobs 113,000 Alaska Related Labor Earnings $6.2 billion Includes direct, indirect, induced impacts Alaska exports : 74,000 jobs Puget Sound goods/services provided to Alaska Natural resources: 39,000 jobs Fishing, processing, petroleum, tourism Natural Resources 39,000 Exports 74,000
Impact Trends 2003 2013 Jobs 103,500 113,000 (+9%) 2003 2013 Labor Earnings $4.3 billion $6.2 billion (+12%*) *Adjusted for inflation.
Ties that Bind: Sectors Cargo/freight Seafood Passenger transportation/tourism Petroleum Maritime support Health care Education
Freight and Cargo
Freight and Cargo 3.4 million tons moved between Puget Sound and Alaska in 2013 80% northbound, 20% southbound 97% water, 2% truck, 1% air Trade with Alaska accounts for over 80% of domestic containerized shipments at Ports of Seattle and Tacoma (20% of total) Economic Impacts Jobs 5,500 Labor Earnings $450 million
3,500,000 Alaska Washington Waterborne Cargo (Tonnage) 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Northbound Cargo Southbound Cargo
Seafood Largest Alaska Puget Sound Sector Three components: Commercial fishing Seafood processing Government & industry orgs. Puget Sound residents own nearly 1,000 vessels participating in Alaska commercial fisheries 36 processors based in Puget Sound account for 82% of first wholesale value in 2013
Seafood Impacts Commercial fishing 10,150 jobs $600 million in labor earnings Seafood processing 13,100 jobs $690 million in labor earnings Government/industry orgs 650 jobs $50 million in labor earnings Economic Impacts Jobs 24,000 Labor Earnings $1.3 billion Fishing 10,150 Processing 13,100 Govt/industry 650
Washington Revenue from Alaska Seafood $4,000 $3,500 $3,000 $818 $Millions $2,500 $2,000 $1,500 $619 $2,074 $2,462 $1,000 $500 $0 2009 2010 2011 2012 2013 WA Based Processors (Less Fish Cost) Gross Fishing Earnings WA Residents
Transportation & Tourism Sea Tac: 1.1 million Alaskabound air passengers Port of Seattle: 430,000 Alaska cruise passengers Alaska Marine Highway: 14,000 Alaska ferry passengers Economic Impacts Jobs 14,100 Labor Earnings $554 million
Enplanements or Passengers 1,200,000 1,000,000 800,000 600,000 400,000 200,000 Air and Cruise Passengers: Sea Tac & Port of Seattle 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Enplanements to Alaska from Sea Tac Cruise Passengers from Port of Seattle
Petroleum Five refineries in Puget Sound: Ferndale (2), Anacortes (2), Tacoma Alaska is #1 supplier of crude to Puget Sound s refineries (46% of their volume) 265,000 barrels/day Economic Impacts Jobs 12,000 Labor Earnings $780 million
2,500 2,000 1,500 1,000 500 Petroleum Production: Alaska, Western Canada, and North Dakota Alaska North Dakota Canada Oil Sands Barrels/Day (Thousands) 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Maritime Support Services include ship construction, repair, maintenance, supply of marine related goods and equipment, & manufacturing Vessels from Washington represent 56 percent of Alaska fleet s gross tonnage Economic Impacts Jobs 5,300 Labor Earnings $390 million
Health Care Many services not available in Alaska Shared providers: Providence, Providence/Swedish, PeaceHealth, Universal Shared expertise: 10% of Alaska physicians report WA address; WWAMI program Puget Sound facilities served over 2,000 Alaska residents in 2013 at 33 different facilities (inpatient only) Economic Impacts Jobs 1,200 Labor Earnings $100 million
Education Washington is #1 state for Alaska students attending outof state 600+ Alaska students at Puget Sound institutions 35 different Puget Sound institutions 2005 12 Programs: WUE, WWAMI, Alaska scholarships Economic Impacts Jobs 250 Labor Earnings $11 million
Tribal Ties Five regional ANCSA corporations operate 14 subsidiaries in Puget Sound Subsidiaries represent a range of sectors: engineering, construction, security, timber, consulting 850+ people employed in WA $51 million+ in direct payroll in WA
Additional Ties Federal government NOAA/NMFS EPA Region 10 Military Business/professional services Finance/banking/accounting Public relations Engineering Law Consulting
Outlook DOWNSIDE/FLAT Declining oil production and prices Cargo, population, overall economic activity Alaska population projections modest at 1% annual Seafood: stable value for 2015 (pending salmon season); Alaska based processors growing Limited cruise growth capacity UPSIDE Potential big projects: gas pipeline, OCS oil and gas development Seafood: Long term upside due to resource size, management, & branding Maritime services: aging Alaska fleet needs replacement Tourism: will grow along with nationwide economy Strong Puget Sound economy and population growth Alaska Puget Sound ties will continue to strengthen as economies and populations grow
More in the Report! Overview of each economy Additional detail on each sector Trends Outlook Impacts on Alaska Available at www.alaskachamber.com www.seattlechamber.com
Ties that Bind The Enduring Economic Impact of Alaska on the Puget Sound Region McDowell Group, Inc. Seattle Propeller Club March 18, 2015