Local News

SEDA report: Sitka’s economy turns corner

The economy in Sitka – like the rest of the state – appears to have turned a corner. According to the latest quarterly report Trends published by the Sitka Economic Development Association, income and employment are on the way up.

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It’s not a totally rosy picture, by any means. There still remains a huge gap between housing affordability and incomes, for instance, and Sitka’s per capita income lags behind the rest of the state. But on several key indicators, Sitka is doing better than it was two years ago.

Garry White is the director of the Sitka Economic Development Association, which publishes Trends. Most notably, there are more people working in Sitka – almost 150 more – than in 2010.

“When that was happening, Sheldon Jackson was closed. We had nothing going on there. The Science Center wasn’t happening. So a lot of this could be some of the development efforts that have gone on with the former Sheldon Jackson campus, increased seafood processing, and a couple of big projects coming on line here.”

When Sheldon Jackson College closed in 2007, an estimated 100 staff lost their jobs. The number of people working on the new campus has not made up that difference, but those that are working are making a difference in the local economy. In addition, sixty fewer people filed for unemployment benefits in the last quarter of 2012 than the two years before, and the local unemployment rate – at 6.1-percent – is almost three full points under the national average.

White says that in working with government data, it’s often easier to come up with numbers than with answers.

Sales tax revenue in the 3rd quarter of 2011 was $2.8 million, just about even with the same quarter in 2012. White thinks Sitkans might be economizing to offset increases in prices, that otherwise might have pushed up tax revenues.

“Food prices have gone up 44-percent since 2008. Fuel’s about the same as last year. Cruise passengers are about the same as last year. There are some inflationary things that suggest that sales tax should be up – but it’s not. It’s fairly even to down just a little bit.”

Sitka’s population has ticked up over the last two years, along with enrollment in schools. Even though cruise tourism is down, Sitka’s bed tax – paid by overnight guests – is up almost $3,000 compared to the last quarter of 2010.

White has mixed feelings about housing prices in Sitka. The average list price of a home last quarter was $383,000, almost $100,000 more than the average listing two years ago.

Rents are on the rise, too. White says SEDA is moving ahead with trying to change Sitka code to allow for higher densities in residential neighborhoods, with the addition of detached garage apartments – also known as mother-in-law apartments. He thinks housing affordability is critical to retaining younger workers.

Personal income in Sitka has not kept pace with the rest of the state, and even lags behind some communities regionally. On average, Sitkans earn about $10,000 less than workers in Ketchikan. White says this is not a new trend.

“Well in 1990, Sitka’s per capita income was $22,000, and Ketchikan’s was $28,000. So we were $6,000 behind them even then.”

White attributes this difference to more high-paying industrial jobs at the Ketchikan shipyard. But he’s not discouraged. He says making up the difference means that there are “opportunities” in Sitka that have not yet been realized.


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