Get Ready for the Big ‘R’
© Patrick Endres / AlaskaStock.com
R starts a lot of words—good, bad, and indifferent—some words just are. The big “R” word Alaskans are holding their breath for these days is recession. In Anchorage’s first one hundred years there have a been a few, the first one probably occurring after the completion of the railroad when those thousands of railroad workers left and the community heard the first whoosh as all those workforce wages disappeared from the new economy.
Looking statewide, though, better known Alaska recessions are more recent—1977, 1985, 2009. The one that began in 1977 happened after the trans-Alaska oil pipeline was complete and thousands of pipeline jobs disappeared. The 1985 recession has been attributed to the price of oil; however, it happened after the state-funded mega projects known as Project 80s were complete and the banks fell when the housing market crashed. The most recent one, the one that began in 2009, was a delayed reaction in Alaska to the 2007 “subprime spillover” national housing market crash that lead to the stock market crash and national recession in 2008-2009 and lasted until the federal government’s stimulus program and bank bailout pumped trillions of dollars into the national economy.
This recession, Alaska’s latest recession—some say it began in summer 2014 and some say it is likely to begin soon—will probably be long and hard. There will be no big money bailout, no federal stimulus package, no state spending spree, no oil price recovery to $100 barrel—no cure save time and economic growth.
So what can be done? Well, a recession is somewhat akin to anxiety in that eventually it will pass—here are a few “R” words that can help until it does.
- Retire: A lot of people are retiring. What better way to avoid the recession altogether? Retire. (Not everyone can do this.)
- Reality Check: Many are taking stock of where they are with what they have. Know what’s real when it comes to revenues, finances, holdings, budgets, expenses, incomes, and likely outcomes. (Everyone can do this.)
- Reduce Debt: Others are reducing debt, retiring debt, restructuring debt, or in some way or another dealing with debt.
- Revise: During a recession many things need revised—start with spending and saving patterns. Now is the time to revise budgets, plans, and the like.
- Read: Keep reading to stay informed—know what’s going on. Read Alaska Business Monthly, we’re going to continue to bring stories from the Alaska economy, including many with words of wisdom from statewide leaders in the business community and beyond as we rally during this next recession.
You’ll see when reading the December issue that the team has put together another really great magazine. Enjoy!
—Susan Harrington, Managing Editor
This article first appeared in the December 2015 print edition of Alaska Business Monthly.