• Alaska’s economy and the COVID-19 virus

      Guettabi, Mouhcine (Institute of Social and Economic Research, University of Alaska Anchorage, 2020-03-27)
      The Alaska economy, similar to the rest of the world, will contract over the next few weeks and months due to the COVID-19 virus that has forced businesses to close or significantly curtail operations. While it is near impossible to identify the true economic consequences of these measures, we make educated assumptions about the size of the layoffs in the most vulnerable sectors. To get the full scale of the potential losses, we estimate multiplier effects from these losses using an input output model. Layoffs in the directly affected sector could exceed 27,000 with a payroll of almost 80 million dollars in the month of April. The indirect and induced effects of this shock could result in another 21,000 jobs lost if the employment separations are not temporary. In the second quarter of 2020, direct GDP losses due to the decline in economic activity -not including declines in oil prices- could amount to almost 2 billion dollars. If the disruption in economic activity is not short-lived, we could expect another 2 billion dollars in losses due to the indirect and induced effects. The significant Federal aid package which will provide a boost to unemployment insurance, direct transfers to households, and aid to businesses will certainly dampen some of the consequences we estimate. While the short term costs of social distancing are high, Alaska’s long term economic health depends on first containing the virus.
    • Long-term benefits to Indigenous communities of extractive industry partnerships: Evaluating the Red Dog Mine

      Berman, Matthew; Loeffler, Bob; Schmidt, Jennifer (Resource Policy, 2020-02-21)
      Mining, and oil and gas companies developing resources on land historically occupied and used by Indigenous peoples have faced criticism for offering few benefits to local communities while inflicting environmental damage. The Red Dog Mine – a joint venture between Teck Resources, Inc. and the NANA Regional Corporation – has often been cited as an example for developing extractive industries in a way that does benefit Indigenous communities. The mine is located in an economically impoverished region in Northwest Alaska that has few other wage-earning opportunities for the largely Inupiat population. Although the mine has brought demonstrable financial benefits to the region, questions persist about its long-term benefits to local communities. This paper assesses a suite of long-term benefits of the Red Dog mine, based on findings from unique 14-year panel dataset. The paper focuses on the direct effects of the mine on the individual Indigenous workers of the region. Specifically, the analysis addressed the following set of questions: How does employment at Red Dog affect workers’ mobility and long-run earnings? How long do most local residents hired to work at the mine keep these jobs? What percentage of the mine workers live in the communities in the region, and what percentage of the total payroll do local workers receive? The findings illustrate the strengths and limitations of partnerships between Indigenous organizations and extractive industries, and offer insights relevant to Indigenous communities across the arctic and around the world as they plan development of local resources.