Alaska’s Fishing Industry: The universal relevance of a multi-billion dollar industry

May 1, 2012 | Finance, Fisheries, Small Business

Paula Dobbyn

Tele Aadsen started out in Wasilla, spending her first few years in the strip mall town north of Anchorage later made famous by a certain former Alaska governor. But the Sitka troller and writer didn’t remain in Mat-Su for long. When Aadsen was a second grader, her parents, Ken and Val, built a sailboat in their Wasilla backyard, a construction project that eventually morphed into a job and a lifestyle for their daughter.

“My fishing career started in 1984 when I was seven,” Aadsen says. “After my parents finished the boat, they sailed it from Anchorage across the Gulf of Alaska without any clear idea of what was going to happen next.”

As it turned out, the Aadsens found themselves in Sitka, one of Alaska’s busiest fishing ports located on the outer coast of Southeast’s scenic Inside Passage, surrounded by the lush Tongass National Forest. As the family moored their sailboat, Sitka’s docks were crawling with people offloading fish and others looking for deckhand jobs. The family instantly got caught up in the summer fishing frenzy that defines many coastal Alaska communities.

They decided to rig up the sailboat as a hand troller and try their hand at salmon fishing.

“After a couple of years it became obvious we weren’t going to earn a living that way,” Aadsen says.

In the fall of 1986, the Aadsens decided to get serious. They traveled to Port Townsend, Wash., and found a fiberglass hull. They traded a piece of land they owned in Petersburg for the hull, and went to work transforming it into a power troller. The family lived in “a broken-down motor home outside the boat barn,” and, later, in the Port Townsend boat yard, working 18-hour days to get the Willie Lee II built in time to fish the upcoming season.

“They didn’t know it was impossible for a couple to build a boat in nine months, so that’s what they did,” Aadsen says. “We fished the Willie Lee II that July and sold the sailboat.”

They fished together as a family for a few more years. But the bottom fell out of the Alaska wild salmon market in 1989 following the Exxon Valdez spill, and Ken decided to get out of the business. Val, however, saw a future in commercial fishing in Southeast Alaska and kept the boat. The couple split.

At the time, according to Aadsen, Val was one of the few female skippers in Southeast Alaska, and her only crewman was her daughter. They fished for nearly a decade together until a few years of poor returns, low prices and equipment costs took a financial toll. Her mother ended up selling their boat.

Aadsen took a break from fishing, got a master’s degree and did social work in Seattle for seven years. But, like many fishermen who get hooked on the lifestyle, Aadsen’s heart was on the water. She traded her social work job for a full-time career as a troller and a longliner in Southeast Alaska and hasn’t looked back since.

“I’m paying off my student loans with my fishing business,” says Aadsen, who is also writing a memoir while maintaining “Hooked,” her popular fishing blog.

Loving What You Do

She and her partner, Joel Brady-Power, own and operate a 43-foot fiberglass troller, F/V Nerka, which they fish from July through September. Before the salmon season, Aadsen longlines for halibut and black cod in April and May.

“I don’t love killing fish, but I love my life as a fisherman,” she says.

As a fisherman, Aadsen cherishes being able to provide a high-value, carefully managed and sustainable product, and being surrounded by the beauty of Alaska, as well as the fact that she’s her own boss.

Despite the mystique of working for oneself on Alaska’s pristine waters with stunning mountains and glaciers as a backdrop, commercial fishing can be a brutal, competitive and highly risky business. It’s definitely not for everyone, notes Bruce Wallace, a longtime Juneau resident, seiner and vice president of United Fishermen of Alaska, a trade association representing 37 commercial fishing organizations.

“A lot of people dream about having a career in fishing, but the industry has a way of selecting the people who will stick around. A lot of people crew for a few years and then they say, ‘It’s time to go get real.’ Some of us never get out of Alice in Wonderland, but that’s another story,” Wallace says.

Raking It In

Wallace got into fishing about 40 years ago in Alaska. He had one of his best seasons ever last year when Southeast Alaska outpaced every other region in the state, including Bristol Bay, for its commercial salmon harvest, valued by state regulators at more than $203 million.

Southeast was also the state’s most productive region in terms of number and weight of salmon caught. Southeast fishermen hauled in 73.5 million fish weighing 324.5 million pounds, according to the Alaska Department of Fish and Game.

“I know that some boats landed more than 2 million pounds of pinks. At 45 cents a pound, that’s a pretty good season,” Wallace says.

Southeast high school kids who worked as deckhands aboard seiners reportedly came away last summer with tens of thousands of dollars. Some showed up at school in the fall driving shiny new pick-up trucks bought with their crew earnings, according to reports from fishermen.

World’s Top Producer

In Alaska, salmon is both big business and a cultural icon. People tend to associate Alaska with salmon, and for good reason. Alaska is one of the few places where wild salmon largely remain healthy and abundant due to intact habitat and careful management.

Gillnetters wait to deliver their fish to tenders in the Ugashik fishing district, Bristol Bay, Southwest Alaska.

Alaska is the world’s top producer of wild salmon, eclipsing Russia, China and Japan, according to research by Gunnar Knapp, an economics professor and fisheries expert at the Institute of Social and Economic Research in Anchorage.

The state produces nearly 80 percent of the world’s supply of wild king, sockeye and coho, all high-dollar species. Although salmon constituted just 18 percent of the total volume of seafood caught in Alaska in 2010, it accounted for 35 percent of the export value, according to the Alaska Seafood Marketing Institute.

Times have been good lately for Alaska’s commercial salmon fishermen with prices on the rise. Wholesale salmon prices jumped from $1.31 per pound in 2002 to $2.45 per pound in 2010, according to the Juneau-based research firm, McDowell Group. During this same period, the total value of salmon permits also rose from $205 million to nearly $521 million.

Salmon is just one of Alaska’s top commercial fish species. The other notables include herring, halibut, shellfish and ground fish.

Ground fish—namely pollock, cod, rockfish, hake and haddock—are the big kids on the block. Some 43 percent of the export volume of Alaska seafood came from pollock in 2010, according to ASMI. Pollock is a tasty white fish often made into fish sticks and battered frozen fillets.

Alaska’s ground fish harvest is one of the world’s largest commercial fisheries. According to a study published in 2009 by Northern Economics, a research firm with offices in Anchorage and Bellingham, Wash., Alaska ground fish and flat fish made up about one-fifth of the world’s catch of these species in 2006.

All told, commercial fishermen in Alaska harvested a staggering 4.5 billion pounds of seafood in 2010.

Big Numbers

Although oil is king in Alaska—funding more than 80 percent of the state’s treasury—fishing dwarfs petroleum in some regards, particularly in employment numbers. The fishing industry is Alaska’s largest private-sector employer and fish are the state’s main export product.

Think of it this way: in the United States, about 99,000 people make their living as commercial fishermen, and more than half of them do so in Alaska. According to the McDowell Group, using Alaska Department of Labor figures, Alaska directly employed some 53,000 people as fishermen or in processing jobs in 2009. About 45 percent of them were Alaskans with the rest from out of state.

But despite the fact that a relatively high percentage of seafood jobs are held by nonresidents, the industry brings enormous sums into Alaska through direct and indirect employment, taxes and sales.

According to ASMI, the wholesale value of Alaska seafood in 2010 totaled $3.8 billion dollars. In 2007, that number was $3.6 billion, according to the Northern Economics study. But the so-called ripple effect makes the figure much larger. The $3.6 billion generated another $2.2 billion in indirect economic activity for a total of $5.8 billion in economic output for Alaska, the report concludes.

That nearly $6 billion economic contribution makes fishing a key economic workhorse for Alaska. Behind oil and gas and the federal government, the seafood industry ranks third in Alaska as far as generating basic economic activity.

It’s especially important in rural parts of the state.

Rural Jobs

Fishing is an integral part of the culture and economy of rural Alaska, and in many cases, the primary economic driver.

Alaska has about 44,000 miles of coastline dotted with cities and villages. In many of these isolated areas, unemployment is sky high and the cost of living exorbitant. Fishing offers a way for rural Alaskans to pay bills, through commercial harvest, in jobs associated with the sport fishing industry, and through traditional subsistence gathering.

According to the McDowell Group, one in every seven rural Alaska residents of working age found employment aboard a commercial fishing vessel or in a processing plant in 2009.

“In many rural communities, fishing provides one of the few options to earn cash,” says Tyson Fick, communications director for ASMI.

Many of Alaska’s top fishing ports are located in rural areas, such as Unalaska/Dutch Harbor in the Aleutians, Kodiak, Naknek-King Salmon in Bristol Bay, Cordova, Ketchikan, Petersburg, Sitka, Wrangell and Yakutat. Other major hubs lie in more populated spots including Seward, Juneau, Homer, Kenai and—the state’s largest city—Anchorage.

In terms of gross earnings from commercial fishing, the remote Aleutians and Pribilof Islands are typically the highest-ranking part of the state. According to ASMI, the gross earnings of permit holders in this region in 2009 totaled more than $657.5 million.

That’s followed by the Southeast panhandle with grossing earnings of $173.48 million. Bristol Bay came in third with $133.32 million; Southcentral fourth with $131.35 million; and Kodiak fifth with $111.16 million.

When you compare Alaska’s commercial fishing industry by size of work force, Southeast ranks highest. In 2009, Southeast had a seafood industry work force of more than 10,150. The Aleutians and Pribilofs came in second with work force of 5,309. Bristol Bay, Southcentral and Kodiak followed respectively.

Regarding export partners, China is Alaska’s biggest buyer in terms of volume. Japan is the largest in terms of total value. Brazil is also a very important emerging market for Alaska.

“Brazil is one of the world’s fastest growing economies. The population of Brazil is three and a half times that of Europe and they’re big fish eaters,” Wallace says.

ASMI recently opened an office in Sao Paolo, Brazil, in hopes of expanding Alaska seafood exports to the South American nation, Fick says.

Protecting The Resource

Alaska is blessed with rich stocks of wild fish, and the science-driven management provided by state and federal regulators is often held up as a model for other states and countries—but that’s not to say there aren’t threats: ocean acidification, climate change, endangered species listings, habitat alterations and pollution are some, to name a few. At least one salmon-rich region of Alaska faces the prospect of a major new mining development over which many fishermen have expressed concern.

There’s also unrelenting fishing pressure from other countries with less rigorous regulations than Alaska.

“The ocean is a productive soup and everyone wants a share of it,” Wallace says.

As fishermen adopt increasingly sophisticated technology to find and capture fish, pressure on the resource grows. But management, at least in Alaska, has proven adept at responding to advances in equipment, shifts in fish populations and other changes, he says.

“As the industry gets better at doing what it does, the management gets more conservative. It’s an economic-ecological balancing act,” he says.

Knapp notes that the world’s vast oceans are still an unknown entity in many respects and nothing about the future of commercial fishing is certain.

“Even with the best and most consistent and conscientious management, we don’t control the oceans,” he says.

One of the things we do have some control over is how we manage fish habitat within our state and habitat conservation is critically important, says Aadsen.

“What I see sometimes is a sense of entitlement to our resource. You’ll hear some folks say, ‘This is here for us to use,’ as if Alaska is somehow exempt from the consequences that salmon have experienced in the Lower 48. In Alaska, we can’t even imagine our salmon not being here,” Aadsen says.

As more young people break into the ranks of commercial fishing, Aadsen says she sees growing awareness among the fleet that unless the watersheds that produce salmon are left intact, the same problems that decimated salmon runs in the Pacific Northwest and elsewhere could happen here.

“What we have up here is nothing that should ever be taken for granted,” she says.

This article first appeared in the May 2012 print edition of Alaska Business Monthly magazine.

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