Alaska's Economic Situational Analysis
Phase I: Situational Analysis Complete and Now Online - http://www.alaskapartnership.org/
Last October the Alaska Partnership for Economic Development (APED) partnered with a group of nationally recognized consulting firms – IHS Global Insight, Economic Competiveness Group and McDowell Group – to begin analyzing Alaska’s current economic environment and provide an “economic reality check” of where our state stands and the direction we’re heading. The analysis, which is now available on our Web site (www.alaskapartnership.org), found that Alaska’s economic development system is largely ineffective and our future uncertain.
Perhaps the biggest theme coming from the report was the fact that there is a lack of statewide planning, leadership and coordination on economic development initiatives. Although Alaska has a large number and variety of economic development entities, their focus is local or regional, rather than statewide, and thus limits the effectiveness. Moreover, the high concentration of economic development organizations often leaves statewide efforts fragmented and potentially contradictory. Many of the previous statewide efforts have neither been fiscally sound nor cohesive in bringing resources and people together.
Alaskans should worry not because of any immediate economic crisis, but because of the accumulating levels of future risk and declining economic resiliency associated with:
• Poor relative economic performance compared to the rest of the country.
• A high level of dependence on the price of oil, federal government spending, and natural resource industries facing supply or regulatory/legal constraints.
• Weak linkages to rapidly expanding global market opportunities.
• Ignoring opportunities for diversification and increased resiliency by optimizing the needs and linkages within and among the state's existing portfolio of export-oriented industry "clusters."
• Weak culture of entrepreneurship.
• Sub-par support from the state's economic foundations compared to other peer states in the area of transportation and other infrastructure, quality of workforce/education, and technology.
This risk represents the basis of our call to action for a different approach to economic development.
Oil prices may stay at or above current levels, significant new sources of oil and gas may be tapped, and federal government spending may keep rising. However, the probability that these events will not happen is uncomfortably high.
Can Alaska make the necessary changes in policy and practice to build a more diversified and sustainable economy?
The path forward involves creating more competition among industries, regions and communities. We must make the business climate become an advantage for Alaska, not a disadvantage. We must leverage our current wealth and abundant resources to foster innovative and strategic thinking on a statewide scale.
All of this will begin with a Statewide Economic Summit we plan on having in the spring. The summit will involve moving towards a more collaborative, statewide approach to economic development that is focused on developing a stronger portfolio of export-oriented industry clusters. The effort will be lead by the private sector and supported by the public sector and will take a statewide approach knowing that a stronger portfolio of industry clusters will benefit all the regions of the state.
As citizens, business leaders, and professionals, we ask for your help in putting this momentous event together. If you would like to get involved, there are opportunities for sponsorship and direct involvement in the Statewide Economic Summit.
Our Phase I report is available online at www.alaskapartnership.org. We ask that you share it with your colleagues, friends, family, co-workers, and associates and forward this newsletter on to them as well.