Ties that Bind The Enduring Economic Impact of Alaska on the Puget Sound Region McDowell Group, Inc. Tacoma-Pierce County Chamber August 13, 2015
Jan 11, 2016
Ties that BindThe Enduring Economic Impact of Alaska on the Puget Sound Region
McDowell Group, Inc.Tacoma-Pierce County Chamber
August 13, 2015
McDowell Group•Research and consulting since 1972•16 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, industry-
specific impact reports, McDowell Group data, interviews, business survey• IMPLAN for economic impact analysis
SponsorsPresenting Sponsor• Alaska Airlines Gold Sponsors• Lynden Transport, Inc. • Port of Seattle • Port of Tacoma• Shell Oil Company• Totem Ocean Trailer ExpressSilver 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. BankSupporting Sponsors• Alaska Salmon Alliance• Fifth Third Bank• Nexus NorthwestCo-Presenters• Seattle Metropolitan Chamber of Commerce• Alaska Chamber• Tacoma-Pierce County Chamber of Commerce
Economic Impact
• 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
Ex-ports
74,000
Natural Re-
sources39,000
Economic ImpactsAlaska-Related Jobs 113,000Alaska-Related Labor Earnings $6.2 billion
Impact Trends
LaborEarnings
Jobs
$4.3 billion
$6.2 billion
103,500
113,000
(+12%*)
(+9%)
*Adjusted for inflation.
2003
2013
2003
2013
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 ImpactsJobs 5,500Labor Earnings $450 million
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
Alaska-Washington Waterborne Cargo (Tonnage)
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
Fish-ing
10,150
Pro-cess-ing
13,100
Govt/industry
650
Economic ImpactsJobs 24,000Labor Earnings $1.3 billion
2009 2010 2011 2012 2013$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
Washington Revenue from Alaska Seafood
WA-Based Processors (Less Fish Cost) Gross Fishing Earnings - WA Residents
$Mill
ions
$2,074
$619
$818
$2,462
Transportation & Tourism• Sea-Tac: 1.1 million Alaska-
bound air passengers •Port of Seattle: 430,000 Alaska
cruise passengers •Alaska Marine Highway: 14,000
Alaska ferry passengers Economic ImpactsJobs 14,100Labor Earnings $554 million
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Air and Cruise Passengers: Sea-Tac & Port of Seattle
Enplanements to Alaska from Sea-Tac Cruise Passengers from Port of Seattle
Enpl
anem
ents
or P
asse
nger
s
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 ImpactsJobs 12,000Labor Earnings $780 million
19811983
19851987
19891991
19931995
19971999
20012003
20052007
20092011
2013 -
500
1,000
1,500
2,000
2,500
Petroleum Production: Alaska, Western Canada, and North Dakota
Alaska North Dakota Canada Oil Sands
Barr
els/
Day
(Tho
usan
ds)
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 tonnageEconomic ImpactsJobs 5,300Labor 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 ImpactsJobs 1,200Labor Earnings $100 million
Education•Washington is #1 state for
Alaska students attending out-of-state• 600+ Alaska students at Puget
Sound institutions• 35 different Puget Sound
institutions 2005-12• Programs: WUE, WWAMI,
Alaska scholarships
Economic ImpactsJobs 250Labor Earnings $11 million
OutlookDOWNSIDE/FLAT
• Declining oil production and prices (below $45/barrel)• Cargo, population, overall economic activity
• Alaska population projections modest at 1% annual• Seafood: strong US$ presents challenge; stable/slightly lower 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
• Recent T5 issue pushing AK-WA relations into spotlight
More in the Report!•Overview of each economy• Additional detail on each sector• Trends• Outlook
• Tribal ties• Additional ties• Impacts on Alaska• Available at
www.seattlechamber.com
Ties that BindThe Enduring Economic Impact of Alaska on the Puget Sound Region
McDowell Group, Inc.Tacoma-Pierce County Chamber
August 13, 2015