Alaska unemployment rate in double digits due to pandemic
ANCHORAGE, Alaska (KTUU) - Economists are saying unemployment in the U.S. has risen higher in three months than it did over two years during the great recession, and Alaska is feeling it. After several months of some of the lowest unemployment rates Alaska has experienced, things took a sharp turn starting in April.
According to a new report by the U.S. Bureau of Labor Statistics, Alaska’s unemployment rate doubled from 6.2% in June of 2019, to 12.4% in June of 2020. Anchorage saw an even higher jump, from 5.3% in June 2019, to 12% in June 2020.
State Economist Neal Fried says Alaska’s unemployment rate in March 2020 was one of the lowest the state has experienced. It was 5.3% before skyrocketing over the following few months, which is right when the pandemic began to take its toll on the economy.
"It just happened so quickly. That's just never happened before. That's what makes it unique," said Fried. "We've had recessions before, we've had high unemployment before, we've had large job losses, but never this quick, and all really happening in one month. We went from 1,000 unemployment claims to 7,000 to 14,000 all within three months."
Fried says this is directly related to the pandemic, and it's following a similar nationwide trend as sectors of the economy see closure.
“Every sector has seen job losses except for the federal government, and part of that is because the census is taking place so they hired a bunch of census workers,” said Fried. “Health care, surprisingly, the number of job losses also remains quite high. Retail, of course, retail for two reasons. One is because there was a lot of closure and there’s less activity, but eCommerce is also causing some of those losses to take place.”
Data from the State Department of Labor and Workforce Development shows the leisure and hospitality industry took the hardest hit at a 32.4% loss. Oil and gas took a hit as well, losing 14%. The transportation industry is down 12.4%. Construction is down 11.4%, and manufacturing is down by 9.2%. Before the pandemic, economists were expecting 2020 to be much different.
“The story would have been very different. It would have been quite dull. In 2020 we were expecting some recovery, but we were predicting very modest recovery. We weren’t terribly excited about it, but heck, we’d be really happy right now if that’s where we were.”
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