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SWOT Analysis

(Strengths – Weaknesses – Opportunities – Threats)

Strategic evaluation requires assessing economic advantages, Strengths (S) and Opportunities (O), and considering how to mitigate disadvantages, Weaknesses (W) and Threats (T). A SWOT analysis helps quantify factors affecting economic potential, and points actions towards achieving SWAMC’s mission. The analysis addresses economic resiliency to ensure long-term success, viability, durability, and resiliency in the face of change. Southwest Alaska’s rich marine resources, strategic but limited infrastructure and people are the foundations of the region’s economy. SWAMC's SWOT analysis has been conducted on the basis of these three pillars, resources, infrastructure, and people.

Resources

Resources – Internal Strengths 

• Seafood Industry – The commercial fishing industry harvests between 5-6 billion pounds each year from Alaska waters, over 60% of all US domestic harvest. Of the top fishing ports in America, Alaska is home to four of the top 10 by volume, and 6 of the 10 by value. [1] The majority of Alaska landings occur in state and federal waters in the SWAMC region, although immense value comes from high value halibut, salmon and shellfish harvested in state waters. See Figure 6.2 in Resources.

Ocean Productivity – As productive as the wild harvest fisheries are, the ocean has a much higher carrying capacity to sustainably produce new products. The absolute limit is uncertain, although the State of Alaska has pledged the goal of growing the mariculture industry to a $100 million industry by the mid-2030s. With most of Alaska’s coastline, underutilized protected waters, and existing seafood infrastructure, the region is poised to capture a substantial portion of this value. [2] See Table 2.1 Southwest Alaska Area by Boroughs and Census Areas.

• Mineral Development – Rich mineral deposits include the Pebble Mine, in addition to many other identified and speculative deposits. Given concerns of resource conflict the development of large deposits remains speculative. [3] There is a 5% confidence interval for up to 33.72 trillion cubic feet (tcf) of gas and over 2 billion barrels of oil (bbl), it is unlikely these resources will be developed given low confidence, energy alternatives, and competition with existing resources. [4]

Natural Environment - Dramatic mountains, vast and numerous fresh-water lakes and rivers, wetlands, forests, mysterious island archipelagos, volcanoes and productive ecosystems with abundant natural wildlife create demand for outside visitors to explore the region. The mountains, rivers, lakes, wetlands, forests, archipelagos, volcanoes and wildlife in the region also help shape the identity of communities and provide subsistence opportunities for many residents. See Figure 2.3 outlining the topographic features of Alaska.

Tourism Development – The national park system includes Lake Clark National Park and Preserve, Katmai National Park and Preserve, and Aniakchak National Monument and Preserve, in addition to national wildlife refuges and national historic landmarks. State parks including the largest state park in the country, Wood-Tikchik State Park at 1.6 million acres also provide opportunities to grow tourism. [5] Statewide Tourism economic output was up 32% to $4.5 billion in the decade preceding 2017, 5% of which is made up of sales within the southwest. Visitors stay longer in southwest Alaska, for an average of 14 days which is double the State average, and spend more. The most popular activities were wildlife viewing, fishing, cultural activities, and hiking/nature walks. [6] See figures 7.1, 4.1, 4.6, and 4.9 Outlining Geostrategic Location on Map, Air and Plane Transits, and Animal Migrations.

Geostrategic Location – Located in the geostrategic location of the North Pacific between Asia, North America and the Arctic, air and marine super highways direct the flow of commercial aircraft and vessels moving goods, services and people through Southwest Alaska to every major region of the world. Six airlines pass through airspace in the region daily. Roughly 4,443 vessels transit between Asia and America on an annual basis, and as the Arctic opens up, traffic through the Bering Sea has reached a high of 484 vessels, up 123 percent from 2008-2012. [7] The geostrategic location of Southwest Alaska has been of increasing military importance lately as Asian Powers maneuver for geopolitical prestige, the Russian Empire flexes muscle and many nations jockey for access to the Arctic. [8][9][10] Southwest Alaska is also biologically strategically positioned between the North Pacific and Arctic Oceans, where nutrient rich ecosystems are uniquely plentiful and diverse in marine fish, bird and mammal species. The Pribilof Islands of Saint Paul and Saint George are placed on important migration routes for nearly all fish, birds and mammals that populate the rich Bering Sea.

Stranded Energy Potential – The Alaska Energy Authority’s Renewable Energy Atlas of Alaska identifies many Gigawatts of power potential – Wind, Tidal, Ocean, River, Hydro, Geothermal, Biomass and to a lesser extent Solar – available to Southwest Alaska. The convergence of the North Pacific and Bering Sea creates massive potential for ocean and tidal energy. The Aleutians are the epicenter of many North Pacific storm systems that move eastward along the Aleutians, hitting Bristol Bay and Kodiak regions, providing an amazing source of wind power. The collision of the Pacific and North American Plate creates geothermal energy. [11]

Figure 7.1: Arctic Boundary as Defined by the Arctic Research and Policy Act, Source: DOD 2013 Arctic Strategy Memo

Resources – External Opportunities

• Increasing Resident Resource Ownership – The local population may be more willing to commit to long-term investment in the region. Limited access to capital, the largest barrier to becoming permit holders or owners, could be overcome through management and financial policies. For example, Bristol Bay Economic Development Corporation currently offers a permit buy-back program to increase the number of locally owned permits. [12]

• Increased Seafood Products Demand – As the world population grows, and becomes relatively wealthier, demand for high quality, sustainable protein sources provided by seafood are likely to increase. [13] See Figure 6.2 Outlining Increased Demand and Catches of Seafood.

• Increasing Eco & Adventure Tourism Demand – The vast and dramatic landscape that creates difficulties for transportation linkages, add to the region’s remoteness, mystique, abundant natural wildlife and overall natural beauty and are a tourism draw, especially for recreational fishermen, adventurers and travelers looking for ecotourism opportunities. Growing classes of newly wealthy are looking for new and exciting adventures and may be willing to spend extra money for a unique experience. [14] Adventure tourism is growing as well – the market rose 65 percent between 2009 and 2012. [15] Southwest Alaska’s abundance of public lands and proximity to national and state parks also make it a desirable location for U.S. and international travelers. See Figure 6.10 Outlining Increasing Eco & Adventure Tourism Demand.

Increased Minerals Demand – Strained traditional sources and concerns around exploiting third-world countries for minerals is driving increased demand for minerals from well managed resource supplies like those found in Alaska. [16]

• Increasing Arctic Demand – The Arctic and OCS represent some of the least understood environments on earth, and thus a great opportunity for new resources and exploratory possibility, and as Arctic Sea Ice retreats, there is increased likelihood for Arctic Resource Development, which would be served by ice-free points in Southwest Alaska. 

Resources – Internal Weaknesses

• Extreme Weather – While Southwest Alaska is relatively warm by Alaska standards, high winds are prevalent throughout the region, with the highest winds in the Aleutians and Gulf Coast. The low pressures that generate wind also create a prevalence of low cloud cover, fog, and precipitation. This combination of wind and obstructed visibility from precipitation (often rain) places additional strain on the transportation networks, reducing service and increasing costs of operation. See Figure 2.4 Outlining Extreme Weather and Climate Normals.

• Resource Fluctuation – Natural resources experience natural and commodity-based fluctuations on biological and economic cycles. Seafood, the economic engine in the region, is subject to these forces which exposes the regional economy to constant uncertainty. [17][18]

• Resource Seasonality – Natural resources are known for their seasonality. These cycles drive industry and employment in Southwest Alaska. Seasonality makes scaling industrial processes difficult, and employees suffer from uneven revenue streams. [19]

• Resource Value-Adding – Alaska’s fisheries resources are fully utilized, and because the resource is managed for long-term returns, short-term extraction is effectively capped. Over the long-term, new commercial fisheries resources are not expected to proliferate, which leaves only two means of incorporating new money into the regional economy: increased ownership, which allows resource rents to flow back to the region, and increasing value for each unit produced. Due to the maturity of the fishery and high costs of entry, increased local ownership opportunities are limited. Fish access rights are expensive for fishermen, making it difficult for the next generation to enter the industry. When permits are owned by nonresidents they contribute less to the regional wealth because that revenue generally leaves Southwest Alaska. Due to the high costs of energy for operations including capital mobilization, utilization, and transportation, value-added processes are limited.

• Resource Conflict – Abundant resources can lead to conflict for best use and concerns of trading one resource for another. The Fisheries Managers focus on long-term sustainability of the fisheries and balance allocation between different fisher user groups. The proposed Pebble Mine claims to be one of the biggest copper, gold, and molybdenum mines in the world, and brings the potential to diversify the regional economy. However, concerns from the fisheries sector about developing mines at the expense of fish (and culture) has left the project’s future uncertain. [20]

Resources – External Threats

 Impacts of Climate Change – Climate change risks communities, businesses and individuals losing access to key fisheries resources for commercial, sport or subsistence groups. Ocean Acidification poses a great risk to Southwest Alaska’s fisheries, in addition to other ecosystem changes that cause species migration or decline due to alterations in the food-web, currents, water temperature or chemical make-up. [21]

• Impacts of Competing Products – Wild harvest fisheries compete with farmed fish products and other proteins for market share, which ultimately determines the health of the local economy. [22]

• Impacts of Environmental Protections – While often necessary, protections for the natural environment can put additional burdens on local industry. For example, the Steller sea lion was listed as an endangered species in 1990 under the Endangered Species Act. Since its listing, various restrictions and regulations on fishing have had a negative impact on the region’s fishing industry. [23]

• Impacts of Bycatch - Ineffective use of resources leads to lost economic potential. While very few stocks in Alaska are classified as overfished, and the general consensus is that Alaska manages stocks for long-term sustainability, resource conflicts still arise as is evidenced in periods of low abundance, and further conflicted unintentional harvest of non-target species, or bycatch. Continued conflict over best use of the resource will perpetuate ineffective use of the resources. [24]

• Impacts of Resource Conflict – Existing and proposed mining projects have the potential for large-scale spills or accidents, which could affect natural resources such as fish habitat. [25]

• Impacts of Geopolitics – Southwest Alaska resources are destined for global destinations, particularly seafood. Global trade tension and other geopolitical forces can affect prices and access to important markets. [26]

 Competition for Eco & Adventure Tourism – Southwest Alaska is contending in what is becoming an increasingly competitive international market for adventure travel and outdoor activities. Simultaneously, other adventure destinations in locations such as Chile, Ecuador, Japan and Iceland are growing in popularity. [27]

Contamination of soil and groundwater – There are numerous examples of pollution, primarily on land, that have the potential to contaminate groundwater. Some of these sites would be classified as brownfield sites and may require remediation. Many sites are related to military installations and date back to World War II. Other sites are related to communication installations. The most recent concern is with PFAS contamination at airports and other locations.

Infrastructure

Infrastructure – Internal Strengths

• Seafood Processing – Eighteen communities offering land-based processing facilities, and 22 vessel-based processors support the logistics of moving product from mobile vessels to global markets. [28] According to Trident’s website, the Akutan shore plant is the largest seafood production facility in North America, processing over three million pounds of seafood daily and housing up to 1,150 employees. Saint Paul is home to the largest crab processing facility in the world, processing 500,000 pounds of crab daily and employing up to 400 workers in peak season. [29] Unisea’s processing facility in Dutch Harbor processes pollock, crab, halibut, cod and more, and employs up to 1,200 employees. [30] Icicle Seafoods also has shore plant facilities in Egegik, Larsen Bay and Wood River, which collectively employ about 1,000 employees. [31] Peter Pan Seafoods has major processing facilities in King Cove, Dillingham and Port Moller, employing 500, 320 and 140 people respectively during peak production periods. [32] Kodiak Island has 13 state registered fish processing facilities, ranging in size from family owned boutique smokehouses to large scale industrial operations capable of processing 1.5 million pounds of fish per day. [33][34] In all, Kodiak Island employs 1,856 fish processor workers in peak season. [35] The floating Catcher-Processor Vessels that operate in the region are some of the most sophisticated commercial vessels in the world.[36] See Figure 6.6 Outlining Seafood Processing Infrastructure.

• Community Energy – The combined installed energy capacity in region is 136 Megawatts (MW), and sub regionally: Aleutians – 38 MW, Bristol Bay – 28 MW, Kodiak – 70 MW. Aside from the Kodiak grid, which boasts 23 MW of hydro, 9 MW of Wind, and 3 MW of other (batteries and fly wheel), the region is primarily powered with traditional hydrocarbon fuels. This installed energy capacity is a great asset as communities are strategically situated throughout the region. The exception is the far Western Aleutians, where only four communities span an island chain over 750 miles between Nikolski and Shemya, a military facility near the end of the island chain at Attu. [37See Figure 4.17 Outlining Community Energy Infrastructure.

• Seafood Processing Energy – Substantial energy capacity exists with private micro-grids owned and operated by seafood processing companies. In most cases the capacity at these facilities exceeds that of the local utility and serves the purpose of providing control over access to power which is critical to value-added processing. The exception to private power grids are the communities of Kodiak, Naknek/King Salmon, and Unalaska where the community provides power to processors over the community energy grid, although even in these communities, the processing facilities maintain the means to produce their own power. Throughout the region, no less than 14 micro-grids exist that are solely owned and operated by private fish processing companies. [38]

• Seafood Harvest (Federal) – Federal water fisheries are managed by NOAAs National Marine Fisheries Services and include mostly larger vessels required to travel further from port, and include the floating processor fleet, the majority of which operate in the Gulf of Alaska and Bering Sea within the Southwest Alaska region. Ninety-four floating processors represent the Amendment 80, American Fisheries Act and Freezer Longliner fleets. One hundred and ninety-one trawl catcher vessels catch the majority of fisheries volume delivered to shore-based and floating processors. Other important federal fishing vessels include longline and pot vessels, which are better detailed in the State data below. [39See Figure 6.4 Outlining Seafood Harvest Infrastructure in Federal Waters.

• Seafood Harvest (State) – The State of Alaska, Commercial Fisheries Entry Commission (CFEC), manages registered vessels in Alaska including many of the vessels operating in commercial fisheries. The Home Port designation is self-reported, with many vessels reporting non-Alaskan ports; there are 1,049 vessels registered to a non-Alaska Home Ports but registered to fish in Alaska. There are 1,200 vessels between 32’ and 295’ representing mostly commercial fishing vessels reporting Home Ports in Southwest Alaska. There are 634 32’ vessels, representing the Bristol Bay drift fleet. There are 370 33’-57’ vessels representing the diversified small boat fleet. There are 62 58’ Super-58s, which represent an important diversified vessel fishing many species from the Bering Sea to California. There are 133 vessels over 58’ which mostly represent federal fisheries in waters between 3-200 miles from shore. [40See Figure 6.4 Outlining Seafood Harvest Infrastructure in Federal Waters.

• Pleasure craft – The State CFEC record all registered vessels and their Home Port. There are 830 vessels between 7’ and 31’ which likely participate in Sport and Personal Use Fisheries. [41]

• Strategic Ports and Harbors – Unalaska has the westernmost container terminal in the state and serves as the staging area for supplies and fuel to the Bering Sea marine fleet and many communities in Western Alaska. In 2006, the Port of Dutch Harbor (Unalaska) saw almost 1.2 million short tons of freight move through, which includes both foreign and domestic receipts and shipments. Unalaska is only one of two international ports in Alaska, serving export markets to Asia. [42] The Port of Kodiak is a major logistical center and important domestic port which serves Kodiak and many other small coastal Gulf communities to the west. [43] See Figure 6.1 Outlining the top grossing ports in the US, 6 of which are in Southwest Alaska.

Marine – The marine infrastructure of Southwest Alaska supports one of the richest fisheries ecosystems in the world. Six of the top ten fishing ports, by value, are located in the SWAMC region. Strategically located ports capable of supporting harvesting and processing of fisheries resources spread from Kodiak Island to Adak, St. Paul, and Bristol Bay. This includes ports of refuge every few hundred miles. In addition to providing the lifeline to the area’s fisheries, the marine infrastructure supports other vital community services ranging from basic supply of food, shelter, fuel, and marine supplies to specialized services. Twenty-two communities offer harbor facilities capable of servicing and supporting harvest vessels, and offering supply stations for food, fuel, gear, and all aspects of support necessary to effectively execute the commercial fisheries of the Western Gulf of Alaska, Aleutian Islands, and Bering Sea. See Figure 6.1 Outlining Marine Infrastructure.

• Communication – Adequate communication infrastructure is critical for successful natural resource management, educational advantages, and better connection to domestic and global networks, with an overall effect of more opportunity and a better quality of life. Fiber optic cable connects Kodiak, home to 45 percent of the regional population, with Bristol Bay which hosts a hybrid fiber/micro-wave system reaching another 25 percent of the population; the Alaska Peninsula, and Aleutian and Pribilof Islands are serviced by satellite. Expanded communication infrastructure has enhanced and improved the productivity of the region to create new businesses and increase the speed of information transfer. The increasing availability of the internet has opened up access to shopping and business opportunities. For example, Amazon Prime has become a frequently used means of shipping inexpensive globally available supplies. See Figure 4.12 Outlining Communication Infrastructure.

• Air Transportation – Air transportation is the primary means of regional travel; all communities in the SWAMC region have capabilities to receive air service, ranging from dirt runways to some of the largest runways in Alaska (e.g., Cold Bay at 10,180 ft., Adak at 7,790 ft., Shemya at 10,004 ft., King Salmon at 8,901 ft. and Kodiak at 7,880 ft.). [44] These runways provide occasional emergency landing services for the airline superhighway over the North Pacific. Additionally, a service industry for supporting and maintaining small aircraft exists in Dillingham, King Salmon, Cold Bay and Kodiak. See Figures 4.8, 4.9, 4.10, and 4.11 Outlining Air Fields Infrastructure, and Locations.

• Pacific Spaceport Complex – The Alaska Aerospace Corporation (AAC) maintains the Pacific Spaceport Complex on Kodiak Island. AAC works with both national and commercial organizations, primarily doing satellite launches. The Launch Complex brings direct and indirect benefits to the region through local contracting, local hire and increased visitation to the region. The Pacific Spaceport Complex offers the advantage of location, with a wide-open southern launch corridor and an unobstructed down-range flight plan over relatively open-ocean. The location is ideal for launching expendable launch vehicles with payloads requiring low-Earth polar or sun-synchronous orbits. [45]

US Coast Guard – The United States Coast Guard Kodiak base is the largest in the Pacific Area, with a crew of 85 officers and 517 enlisted personnel on 23,000 acres. The Air Station operates MH-60 Jayhawk and MH-65 Dolphin helicopters, and the HC-130 Hercules fixed-wing aircraft, in addition to three military class Cutters, Munro, Spar, and Alex Haley and an Aid to Navigation Team responsible for 71 sites throughout Alaska. The station's primary mission is search and rescue in a 4 million-square-mile area of responsibility covering the Gulf of Alaska, Bristol Bay, the Bering Sea, and Alaska's Pacific coast. [46]

• Military Strategic Location – Shemya Alaska offers a military strategic location. It currently houses the COBRA DANE L-band large phased array radar system, monitoring activity throughout the Pacific Ocean. [47] Eareckson Air Station, is a United States Air Force military airport located on Shemya Island in the Aleutians. The active US Air Force Station closed in 1994 and is owned and operated by the USAF 611th Air Support Squadron at Elmendorf AFB. The Department of Defense plans to invest over $278 million to operate, maintain, and modernize its Cobra Dane radar system—which helps defend against incoming missiles and tracks space objects such as satellites and debris. [48]

Infrastructure – External Opportunities

• Increasing Arctic Activity – A book called The Fast-Changing Arctic discusses emerging opportunities: resources, security and science. Research from the Marine Exchange of Alaska shows a steadily increasing number of Vessel Transits between the Bering Strait and increasing periods of ice-free water. [49][50]

• Increasing Communications Need – A broadband internet connection is increasingly being seen as a basic human right in order to participate in the modern global economy, as more services and networks for good are supplied through a high-speed digital connection. See Figure 4.12 Outlining Services and Good Available Through Internet.

• Increasing Automation Technology – Typically, primary processing occurs locally to create a minimally viable shelf-stable product, where additional processing produces the retail product. Generally, primary processing doubles the value of the resource, and second processing (retail) doubles it again. Traditionally, the high local cost of energy and labor, dictated minimal local processing, although increases in automation may change this dynamic. Increasing value-added production locally will increase the money flowing to the Southwest Alaska economy a result of the raw resource moving up the value-chain.

• Increasing Energy Production Technology – Improving renewable energy technology means that energy investments are becoming more feasible, increasing the likelihood of unlocking stranded energy potential. See Figure 4.17 Outlining AEA Renewable Energy Data.

• Increasing Liquid Natural Gas Demand – The natural gas supply has expanded dramatically, while the costs have fallen. Infrastructure for delivering natural gas is flourishing. This increases the opportunity for accessing LNG as a cheap energy resource for Southwest Alaska. See Figure 4.17 and Figure 6.8 outlining the increasing demand and infrastructure for LNG.

Infrastructure – Internal Weaknesses

• Geography and Connectivity – The lack of overland connectivity limits transportation options to air and sea, raising the cost of moving goods, services and people. Vessels are an efficient means of moving goods, although scaling capabilities to meet needs in small sized communities create further inefficiencies. While vessels are well equipped to move a large quantity of any one item, using vessels to serve communities with many different needs provides for inefficient designs that would be otherwise more capable. The ocean south and east of the Aleutians is ice-free year-round, although sea fast ice forms in Bristol Bay as far south as Egegik, [51] including the Pribilof Islands, completely eliminating the option for marine transportation. The only other current transportation alternative is flying. Flying is fast and flexible, although it is also very expensive, and does not effectively move bulk goods. Air service is constrained by lack of economies of scale, long distances, small populations, and small air strips allowing for only small aircraft to service the community. There is no possibility of an overland route being established to the Southwest Alaska region in the foreseeable future. See Figure 2.3 Outlining Regional Topography and Figures 4.2-4.5 on Challenges to Transportation.

• Maintenance – The limitations to regional transportation linkages precipitate that moving, establishing, and maintaining infrastructure is relatively expensive and slow in comparison to most other regions. Small populations mean there are fewer people and thus higher costs per user of infrastructure, which is especially challenging for public use infrastructure that may not make sense from a market perspective but is critical from a community perspective. Many Southwest Alaska coastal communities have aging infrastructure and limited public funding for replacement due to budget cuts.

• Costly Air Service – Southwest Alaska has a small number of airline operators serving the region. Flights are expensive, and service is often unreliable. Of the 66 airports in the region, many have runways that are insufficient in length or width to handle cargo and/or more than eight passenger aircraft. See Figures 4.8 and 4.10 Outlining Transportation Costs and Runway Locations & Lengths.

• Poor Communication Infrastructure –Cellphones are becoming ubiquitous, in many circumstances replacing landlines as the primary medium of communication. Networks are often strained to provide reliable services, particularly for downloading over the cell network. Internet infrastructure has been built out throughout the region, although service is slow and expensive relative to urban service plans. While Kodiak’s urban zone is served by fiber optic cable, the Kodiak villages, Alaska Peninsula, and Aleutians/Pribilofs only receive expensive, slow, and unreliable satellite service. The Bristol Bay region is served by a microwave system that is expensive with reduced capacity. Cost are high and service capacity is low in all areas outside of Kodiak’s urban zone. See Figure 4.12 Outlining Communications Infrastructure.

• Limited Affordable Quality Housing – Housing is expensive to build and maintain, which leads to relatively high levels of overcrowding and aging abandoned and condemned housing stock. In some communities there is land for development, but the cost of construction and lack of funding create barriers to new housing developments. [52][53See Figure 4.13-4.15 Outlining Housing Stats, Overcrowding, Abandoned, Condemned.

• Aging Processing Facilities – The Seafood processing industry in Southwest Alaska has some of the oldest plants in the state; many are decades old and some are over 100-years old. Aged infrastructure adds costs to updating processes that could be more easily implemented in new builds. Facilities were constructed in a period of low diesel prices and energy efficiency was not a concern or priority. As the price of energy rises, the cost of inefficiency becomes more important.

• High Energy Cost – Many communities struggle to import energy due to high costs and the logistical challenge of bringing fuel into remote locations. High costs of energy act as a tax on the disposable spending power of local populations and an increased cost of doing business. The cost and technological ability to access stranded energy supplies prevents many local sources of energy from entering the local economy. See Figure 4.16 Outlining Energy Costs.

• The Alaska Marine Highway – The Alaska Marine Highway System currently services Southwest Alaska with the M/V Tustumena, the oldest vessel in the State fleet. A replacement ferry has been designed although State funding for new capital and operations costs are at risk due to budget cuts. The State is looking at cuts in service, reorganization, and privatization in an attempt to dramatically reduce or eliminate the substantial subsidization the State now must provide to the AMHS.

Infrastructure – External Threats

• Lack of Cheap Energy Alternatives – Current technology is unable to provide the energy needs of Southwest Alaska at a cheaper delivered cost of power than existing energy systems.

• Reduced Public Investment – To date a great deal of public expenditure has been invested in regional infrastructure, which may not be the case if public budgets tighten.

• Impacts of Natural Environment – Southwest Alaska’s location along the Pacific Ring of Fire means the region is subject to frequent earthquakes and volcanic eruptions that also pose the threat of tsunamis. According to the U.S. Geological Survey and the Alaska Volcano Observatory, 36 of the 41 active volcanoes in Alaska are in Southwest Alaska. According to the Alaska Earthquake Information Center (AEIC) there are over 200 earthquakes with magnitude 4 and greater per year, and about 60 over magnitude 7 in the past 100-years from Kodiak to Attu. While eruptions and earthquakes with magnitudes large enough to cause damage are infrequent, large events do have the potential to negatively impact the region’s economy. [54][55]

• Impacts of Climate Change – Climate change threatens many coastal communities in Southwest Alaska. Some communities are already struggling with erosion, melting permafrost and flooding as a result of climate change.

• Decline of Postal Services - Potential cuts to postal services and rural mail delivery would be catastrophic to the region’s economy [56] See Figure 4.11, using the filter to see mail and cargo delivery volumes.

• Decline of Alaska Marine Highway System - Reduced funding for the Alaska Marine Highway will mean less revenue from tourism and increased costs to communities. [57]

People and Partnerships

People - Internal Strengths

Jobs Availability – The unemployment rate is lower in some Southwest Alaska communities relative to the State average. Many employers, especially in the resource economies need to import workers because there are not enough available workers. [58See Figures 3.4 and 3.6 Outlining Employment Statistics.

Labor Force – Communities throughout the region provide a ready and capable workforce. See Figure 3.1 Outlining Demographics.

Training – A system for training and preparing workers exists.

Government Institutions – A framework of local, state, and federal government programs and services to spur economic development to improve living standards exists throughout the region. The large federal and state presence in the region, in the form of land ownership and major facilities, precipitates a large public sector to manage these resources, equating to salaries injecting new cash into the economy. Additionally, a large government sector brings in funds through grants, infrastructure funding, statewide programs and more. There is also an inflow of government transfers tied to Alaska Native corporate dividends, as well as federal subsidies that go to residents that fall below the poverty line. 

Tribal Institutions – Alaska has an additional resource of Tribal Institutions, including Tribal Governments, Native Regional Corporations, Native Regional Non-Profits, and Native Village Corporations delivering services, jobs, and investment. 

Non-Profit – Interacting as a mediating layer between local, national, tribal and all other aspects of interactivity, the non-profit sector collates data and information to bring additional resources into the regional economy. 

Community – Small and islanded communities develop strong interpersonal networks with shared interests and sense of family. People are good at helping each other. This sense of community decreases some costs and increases quality of life. 

• Community Development Quota Program (CDQ) – The CDQ Program receives about 10% of the Bering Sea Federal fisheries resources to create local ownership of the fishing industry, creating investment in the region. These funds support economic development, education, fisheries, tourism, workforce development and other community development activities and facilities throughout the region. Three of these organizations operate in Southwest Alaska and contribute to in-region investments: Aleutian-Pribilof Islands Community Development Association (APICDA), The Bristol Bay Economic Development Corporation (BBEDC) and the Central Bering Sea Fishermen’s Association (CBSFA). [59]

Community Quota Entities (CQEs) – In 2002, the North Pacific Fishery Management Council took action to address the decline in local resource ownership by small, coastal non-CDQ communities and the negative economic impacts of the decline, by allowing 45 Gulf Coast communities to form non-profit corporations called Community Quota Entities. CQEs purchase catcher vessel quota shares and lease the resulting Individual Fishing Quotas to community residents on an annual basis. There are currently 14 SWAMC communities eligible to participate in the CQE program. [60]

People – External Opportunities

• Increased Geostrategic Location Attention – Over the past five years there has been a national geopolitical shift with an increased interest in strategy and security to the Asia-Pacific region. Southwest Alaska is strategically positioned and may benefit from increased federal infrastructure, investment and resources as a result of its strategic position.

• Increased Quality of Life Demand – In an increasingly crowded, fast-paced and connected world, anxiety among many people is increasing. Within this backdrop, many people find the wide-open spaces and connection to people and the natural world offered by rural Southwest Alaska to be highly-valued. [61][62]

• Increased Climate Tourism Demand – As the average global temperature reaches new highs regularly, year after year, people are increasingly traveling to northern climates to escape summer heatwaves. Southwest Alaska may benefit from people traveling north. [63][64]

• Increasing Robotics Automation – Rural Alaska is synonymous for people overcoming a challenging environment, and often enduring a difficult job for gruelingly long hours. Increasing Automation of Dull, Dirty, Dangerous jobs may increase a desire to live and work in the wilds of Alaska.

• Increasing Automation Technology – Advances in automatous transportation technology has the potential to drastically reduce the cost of life in the region. High transportation costs are one of the major drivers of living costs in Southwest Alaska due to lower material costs and lowering travel barriers for residents, which would result in more people choosing to live in Southwest Alaska.

People – Internal Weaknesses

• Lack of Training – Many in-region jobs are outsourced to a non-resident workforce. To remain competitive, Alaska’s maritime sector needs to ensure Alaskans are qualified to earn well-paid positions and increase the number of Alaskans in this workforce by addressing gaps in technical skills, access to information and training, a lack of exposure to industry, and opportunities for youth. [65]

• Aging Population – The Southwest Alaska population has remained relatively stagnant while those owning resource rights (permits) continues to age. This “graying of the fleet” and associated barriers prevent the small pool of younger fisherman from taking their places. See Figures 2.8 and 2.9 on Population and Workforce Demographics.

• Poor Personal Communication – Basic communication can be difficult, raising the costs of doing business. Networks are not always reliable, people do not always have access to communication hardware and capacity limits prevent text, voice, and especially graphics transmissions. Bringing in an outside workforce becomes more difficult as they learn communication access is not what they expect, limiting their enjoyment, and ultimately employer’s ability to retain employees.

• Poor Institutional Communication – Communication technologies available at institutions like SAVEC and the UAF Bristol Bay and Aleutian campuses are limited compared to urban counterparts. This limits cost effective digital training and online courses.

Non-Resident Employment – Many jobs in the region are filled by non-residents. [66See Figure 3.4 Outlining Non-resident Workforce.

• Data Gaps – The lack of relevant participation data, especially with commercial fishing crew, is a data gap which presents difficulties collecting baseline data to improve conditions for the largest single labor force in the region. There is no workforce development database for tracking employment opportunities, training opportunities and skilled laborers in the region. The information that is available is scattered and difficult to find. [67]

Federal Regulatory Compliance – Interactions with federal agencies can be strained and frustrating for Southwest Alaska business owners and leaders. Different federal agencies have different rules and procedures, making permitting and licensing processes confusing, expensive and difficult to navigate. Many regulations are not a good fit for Alaska but are enforced here. [68]

Substance Abuse – Substance abuse is a serious problem in employing residents and keeping them employed. [69]

Regional Interconnectivity – Expensive transportation, especially inter-region transportation, limits partnerships and networking between neighboring communities. See Figures 4.2-6 Outlining Transportation Linkages.

Local Business Community –Bristol Bay and Kodiak are the only two communities in-region with a Chamber of Commerce. Chambers support and promote local businesses development interests.

People - External Threats

• Impacts of Out-Migration – A globally connected world provides greater exposure to outside opportunities. High costs of living, low levels of infrastructure and relative isolation all work together to increase outmigration. While total population is holding steady due to a higher number of births than deaths, the region is experiencing a net outward migration, contributing to Brain Drain. Some services and organizations have offices and conduct business in Anchorage, making it challenging for local development. [70]

• Changing Resource Base – Changing climatic conditions may already be causing fish population to migrate. In order to meet these changing conditions, employers may ultimately shift their workforces to new locations, thus threatening employment in communities where the availability of seafood resources are decreasing. [71]

• Declining Public Funds – Currently, the region is heavily reliant on public funds for employment and infrastructure; Southwest Alaska’s economy is vulnerable to federal and state funding cuts. Many training programs are covered through a mix of fee for service, but also offset by public funds to make the courses affordable. [72]

• Changes to Government Regulation – Government regulations are overbearing and cost private business money and difficulty of doing business, which translates into lower regional economic potential. Rural Alaska generally has increased costs of doing business, and the effect of onerous regulations may create an outsized burden for industry in the Southwest Region. [73]

Sources

Resources – Internal Strengths

1. National Marine Fisheries Service. 2017. Fisheries Economics of the United States, 2017. U.S. Dept. Commerce, NOAA: https://www.fisheries.noaa.gov/resource/document/fisheries-united-states-2017-report.

2. State of Alaska, Alaska Mariculture Development Plan, https://www.afdf.org/wp-content/uploads/Alaska-Mariculture-Development-Plan_v2018-06-29_FINAL_digital.pdf

3. Alaska Division of Geological & Geophysical Surveys, Alaska's mineral resources 2012 http://dggs.alaska.gov/pubs/id/24784

4. Bureau of Ocean Energy Management, https://www.boem.gov/BOEM-2016A-Assessment-of-Oil-and-Gas-Resources-OCS

5. Alaska Department of Natural Resources. Division of Parks and Outdoor Recreation. http://dnr.alaska.gov/parks/units/woodtik.htm

6. Alaska Department of Commerce, Community and Economic Development, Division of Economic Development:. Economic Impacts of the Visitor Industry & Southwest and Far North Alaska Regions and Communities, https://www.commerce.alaska.gov/web/ded/dev/tourismdevelopment/tourismresearch.aspx 

7. Marine Exchange of Alaska. (n.d.). Marine Exchange of Alaska. Retrieved May 21, 2018, from Port Information - All Regions: http://www.mxak.org/

8. U.S. Department of Defense. (April 1, 2014). Defense Officials in Ukraine for Consultations. Retrieved May 22, 2014 from http://www.defense.gov/news/newsarticle.aspx?id=121949

9. U.S. Department of Defense. (2013). Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China, 2013. Retrieved May 23, 2014 from http://www.defense.gov/pubs/2013_china_report_final.pdf

 10. Joint Base Elmendorf-Richardson. (September 2013). Alaskan Command. Retrieved May 23, 2014 from http://www.jber.af.mil/library/factsheets/factsheet.asp?id=5286

11. Alaska Energy Authority. (2016). Renewable Energy Atlas of Alaska. http://alaskarenewableenergy.org/wp-content/uploads/2016/07/RenewableEnergy-Atlas-of-Alaska-2016April.pdf

Resources - External Opportunities

12. Bristol Bay Economic Development Corporation. (n.d.). Permit Loan Program. Retrieved April 12, 2019 from http://www.bbedc.com/?page_id=187

13. Knapp, Gunnar. (April 2012). Trends in Alaska Salmon Markets. University of Alaska’s Institute of Social and Economic Research. Retrieved April 28, 2014 from http://www.iser.uaa.alaska.edu/Publications/presentations/2012_04_12-TrendsInAKSalmonMarkets.pdf

14. Rising Global Per Capita Wealth, 2013 Global Wealth Report by Credit Suisse Research Institute: Global Wealth Reaches New All-Time High retrieved from: https://www.credit-suisse.com/corporate/en/research/research-institute/global-wealth-report.html

Note particular surge of growth in Chinese tourism, Presidential support noted on May 23, 2014 at: http://www.forbes.com/sites/kenrapoza/2014/05/23/obama-opens-floodgates-to-chinese-tourists/

15. 2015 Concurrent growth occurring in adventure tourism, retrieved from: http://www.adventuretravelnews.com/new-adventure-tourism-report-reveals-263b-market-up-65-per-annum-since-2009

16. World Economic Forum, Mining & Metals in a Sustainable World 2050  http://www3.weforum.org/docs/WEF_MM_Sustainable_World_2050_report_2015.pdf 

Resources – Internal Weaknesses 

17. Business Insider, Kondratiev cycle: https://www.businessinsider.com/commodity-kondratiev-cycles-2012-4

18. Wikipedia, Kondratiev Wave: https://en.wikipedia.org/wiki/Kondratiev_wave

19. Alaska Department of Fish and Game, Commercial Fishing Seasons in Alaska 2016: https://www.adfg.alaska.gov/static/fishing/PDFs/commercial/commercial_season_2.pdf 

 20. Bristol Bay Native Corporation, https://www.bbnc.net/our-corporation/pebble-mine/  Alaska Polling Data, http://www.bbnc.net/wp-content/uploads/2019/04/BBNC-Polling-Toplines.pdf 

Resources – External Threats

21. Climate Science Special Report Fourth National Climate Assessment, Volume I: https://science2017.globalchange.gov/

22. Organization for Economic Co-operation and Development Competition and Commodity Price Volatility: http://www.oecd.org/daf/competition/CompetitionAndCommodityPriceVolatility2012.pdf53.

23. Hui, T.C.Y. (2011). Stellar sea lions and fisheries: competition at sea?: http://www.marinemammal.org/wp-content/pdfs/Hui-2011.pdf

24. 29th Lowell Wakefield Fisheries Symposium, Fisheries Bycatch Global Issues and Creative Solutions: https://seagrant.uaf.edu/events/2014/wakefield-bycatch/program.php

25. US Environmental Protection Agency, Bristol Bay Assessment - Final Report (2014): https://www.epa.gov/bristolbay/bristol-bay-assessment-final-report-2014

26. Trade Partnership Worldwide, LLC, Estimated Impacts of Tariffs on the U.S. Economy and Workers: https://tradepartnership.com/wp-content/uploads/2019/02/All-Tariffs-Study-FINAL.pdf

27. George Washington University and the Adventure Travel Trade Association, Adventure Tourism Development Index 2011: http://cdn.adventuretravel.biz/wp-content/uploads/2012/11/atdi_2011_report.pdf 

Infrastructure – Internal Strengths

28.  State of Alaska Division of Environmental Health. (2014). Food Safety and Sanitation Program: https://dec.alaska.gov/eh/fss.aspx

29. Trident Seafoods. (n.d.). Company. Retrieved May 21, 2014, from Alaska Plants: http://www.tridentseafoods.com/company/plants_alaska.php

30. Alaska Business Magazine (Nov 2015). Alaska's Seafood Processing Industry. Retrieved April, 2019 from: https://www.akbizmag.com/industry/fisheries/alaskas-seafood-processing-industry/

31. Icicle Seafoods http://www.icicleseafoods.com/operations/

32. Peter Pan Seafoods http://www.ppsf.com/facilities/index.aspx 

33. State of Alaska Division of Environmental Health. (2014). Food Safety and Sanitation Program: https://dec.alaska.gov/eh/fss.aspx

34. Trident Seafoods. (n.d.). Company. Retrieved May 22, 2014, from Alaska Plants: http://www.tridentseafoods.com/company/plants_alaska.php

35. Alaska Department of Labor and Workforce Development. (2016). Retrieved April , 2019, from Research and Analysis: http://live.laborstats.alaska.gov/odb/odb.cfm?a=000150

36. Alaska Department of Environmental Conservation, Food Safety & Sanitation Program, ArcGIS, http://www.arcgis.com/home/webmap/viewer.html?webmap=d686c1f3c1e54e7c910a55ca8c9f15b2

37. Alaska Energy Authority, Data Gateway https://akenergygateway.alaska.edu/

38. Southwest Alaska Municipal Conference, Personal Communication, http://www.swamc.org 

39. NPFMC, Fishing Fleet Profiles, https://www.npfmc.org/wp-content/PDFdocuments/resources/FleetProfiles412.pdf

 40. State of Alaska, Commercial Fisheries Entry Commission. https://www.cfec.state.ak.us/plook/#downloads

41. State of Alaska, Commercial Fisheries Entry Commission. https://www.cfec.state.ak.us/plook/#downloads

42. City of Unalaska. Port and Harbor Ten-year Development Plan. http://www.ci.unalaska.ak.us/sites/default/files/fileattachments/Ports%20and%20Harbors/page/503/port_and_harbor_10-year_development_plan.pdf

43. City of Kodiak, Harbor Facilities. https://www.city.kodiak.ak.us/ph/page/port-information

44. Federal Aviation Administration. (2014). NFDC. Retrieved April, 2019 from National Flight Data Center: https://www.faa.gov/air_traffic/flight_info/aeronav/

45. Alaska Aerospace, Pacific Spaceport Complex (2019): http://www.akaerospace.com/

46. US Coast Guard https://www.dcms.uscg.mil/Our-Organization/Director-of-Operational-Logistics-DOL/Bases/Base-Kodiak/

47. Missile Defense Agency. (2019, October). Retrieved April 22, 2019, from COBRA DANE Upgrade: https://www.esd.whs.mil/Portals/54/Documents/FOID/Reading%20Room/Selected_Acquisition_Reports/18-F-1016_DOC_42_DOD_BMDS_SAR_Dec_2017.pdf

48. US Government Accountability Office (2018), https://www.gao.gov/products/GAO-19-68

Infrastructure - External Opportunities

49. Zellen, Barry Scott. (June 2013). The Fast-Changing Arctic: Rethinking Arctic Security for a Warmer World. University of Calgary Press. Accessed May 16, 2016 from: https://press.ucalgary.ca/books/9781552386460

50. Marine Exchange of Alaska, 2018 Bering Strait and Arctic Transits. https://www.mxak.org/

Infrastructure – Internal Weaknesses

51. Source: Alaska Center for Climate Assessment and Policy, Using the Sea Ice Atlas Tool created by the IARC, viewing Feb 2013.Retrieved 27 May 2014. Sea Ice Atlas Tool: http://seaiceatlas.snap.uaf.edu/explore

Project description located at: https://accap.uaf.edu/?q=explore&f[0]=field_content_category%3A47

52. Wiltse, N., Madden, D., Valentine, B., Stevens, V. (2018). 2015 Alaska Housing Assessment. Cold Climate Housing Research Center. Prepared for: Alaska Housing Finance Corporation. Retrieved April 18, 2018 from http://www.cchrc.org/publications

53. Wiltse, N., Madden, D., Valentine, B., Stevens, V. (2018). 2015 Alaska Housing Assessment. Cold Climate Housing Research Center. Prepared for: Alaska Housing Finance Corporation. Retrieved April 18, 2018 from http://www.cchrc.org/publications

Infrastructure - External Threats

54. Natalia Ratchkovski, Ph.D., Seismologist, Alaska Earthquake Information Center, Personal communication, June 19, 2003

55. U.S. Geological Survey. (September 2000). Historically Active Volcanoes in Alaska – A Quick Reference. Retrieved May 22, 2014 from http://www.avo.alaska.edu/pdfs/usgsfs118-00.pdf

56. U.S. Postal Services Office of Inspector General, Alaska Bypass Beyond Its Original Purpose: https://www.uspsoig.gov/sites/default/files/document-library-files/2015/rarc-wp-12-005_0.pdf

57. Alaska Marine Highway Reform Project (2019), The Economic Impacts of the Alaska Marine Highway System: http://www.amhsreform.com/sites/amhsreform.com/files/House%20Informational_SEC_McDowell%20Group%20AMHS%20Impacts%202.5.19.pdf

People - Internal Strengths

58. U.S. Commerce Department's Economic Development Administration (2016). Innovation Index. Retrieved April, 2019 from Stats America: http://www.statsamerica.org/innovation/innovation_index/region-select.html

59. Alaska Department of Commerce, Community and Economic Development. CDQ Program: https://alaskafisheries.noaa.gov/fisheries/cdq-review

60. North Pacific Fisheries Management Council, Community Quota Entity (CQE) Program: https://www.npfmc.org/community-quota-entity-program/ 

People - External Opportunities

61. Healthy nature healthy people: ‘contact with nature’ as an upstream health promotion intervention for populations: https://academic.oup.com/heapro/article/21/1/45/646436

62. The Human–Nature Relationship and Its Impact on Health: A Critical Review (2016): https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5114301/

63. The importance of climate and weather for tourism: literature review (2010): https://www.researchgate.net/publication/47929582_The_importance_of_climate_and_weather_for_tourism_literature_review

64. Economic Effects of Climate Change in Alaska (2019): https://journals.ametsoc.org/doi/full/10.1175/WCAS-D-18-0056.1

People – Internal Weaknesses

65. Alaska Workforce Development Plan, https://www.afdf.org/alaska-maritime-workforce-development-plan/

66. Alaska Department of Labor and Workforce Development. (2016). Research and Analysis Section. Retrieved April, 2019 from http://laborstats.alaska.gov/seafood/seafoodaleutians.htm; http://laborstats.alaska.gov/seafood/seafoodbristol.htm; http://laborstats.alaska.gov/seafood/seafoodkodiak.htm

67. Alaska Department of Fish & Game (2005), State of Alaska Data Collection Programs and Needs: A Report to the Salmon Industry Restructuring Panel: http://www.adfg.alaska.gov/fedaidpdfs/Sp05-05.pdf

68. US Office of Management and Budget, 2017 Draft Report to Congress on the Benefits and Costs of Federal Regulations and Agency Compliance with the Unfunded Mandates Reform Act: https://www.federalregister.gov/documents/2018/03/05/2018-04383/draft-2017-report-to-congress-on-the-benefits-and-costs-of-federal-regulation-and-agency-compliance

69. Alaska Department of Health and Social Services, The Economic Costs of Drug Abuse in Alaska, 2016 Update: http://dhss.alaska.gov/dph/Director/Documents/heroin-opioids/Economic-Costs-of-Drug-Abuse-Final-4.24.17.pdf

People - External Threats

70. Alaska Department of Labor, Alaska’s Brain Drain – Myth or Reality (2004): https://www.bls.gov/opub/mlr/2004/05/art2full.pdf

71. National Oceanic and Atmospheric Administration. (July 2012). Climate & Fish Sticks. Retrieved April, 2019 from http://www.climate.gov/news-features/climate-and/climate-fish-sticks

72. UAA Institute of Social and Economic Research, Short-Run Economic Impacts of Alaska Fiscal Options (2016): https://iseralaska.org/static/legacy_publication_links/2016_03_30-ShortrunEconomicImpactsOfAlaskaFiscalOptions.pdf

73. US Office of Management and Budget, 2017 Draft Report to Congress on the Benefits and Costs of Federal Regulations and Agency Compliance with the Unfunded Mandates Reform Act: https://www.federalregister.gov/documents/2018/03/05/2018-04383/draft-2017-report-to-congress-on-the-benefits-and-costs-of-federal-regulation-and-agency-compliance