Political views shaping confidence in Alaska economy

Nearly 10 years ago, Alaska Survey Research and Northern Economics reached an agreement to begin an ongoing and regular measurement of Alaska economic confidence. Starting in March 2010, and every three months since, ASR has conducted statewide telephone surveys asking Alaskans how they feel about the economy, both in their communities and in Alaska as a whole, and asking them how financially secure they and their families feel.

Last month, we completed the 39th consecutive quarterly survey, all conducted with a consistent methodology and asking the same set of questions, gathering the opinions of 1,150 randomly selected Alaskans around the state. Alaska Survey Research and the Alaska Journal of Commerce have now agreed to present these results publicly every three months.

The central result of this measure is an economic confidence index score. The results to the six questions are normalized onto a 0-100 scale, where 100 is a hypothetical situation where every single survey respondent gives a maximally positive response to every question, and a 0 is the similar situation on the negative end.

The resultant track of this index score over the last 10 years is very revealing. The first couple of years of results were fairly steady in the 53 to 54 range before starting a gradual upward climb.

The peak of 61.9 was reached in September 2014, back when the price of oil was still around $100 and Bill Walker was conducting his ultimately successful run for governor.

But then the wheels fell off, with economic confidence falling in sync with the price of oil. By the time the first quarter of 2016 arrived, the index was sub-50 for the first time.

The years 2016 and 2017 were spent in recession, with the index score bumping along in the 49 to 52 range. But starting in December 2017, things started to recover, and by June last year we were back up to an index score better than 57, a level where we could say with some confidence that the Alaska recession was over.

But hang on, not so fast! The June measure this year saw a steep decline back down. This survey was fielded, of course, during the budget fight in Juneau, with all the talk at the time of vetoes and reverse sweeps and massive cuts to state spending. But the most recent September result shows a steadying of the economic ship , with the index climbing back up to 54.

I mention the political context of these numbers with caution. While we can’t, strictly speaking, state exactly why numbers rose or fell at particular times, we can hypothesize, and we can certainly look within the numbers to identify patterns that inform us.

What we see when we do this is that this data is inexorably connected to “politics”, despite the fact that the questions are asked in each survey prior to any mention of anything political at all.

Back in June, we did a deep dive into the 2019 Q2 data and found that the index score was significantly higher among certain demographic groups, notably men, those aged 65+ and those with household incomes greater than $100,000.

But it was highest of all among self-identified Republicans, conservatives, Mat Su residents and those who watch Fox News and/or listen to KENI radio most.

The lowest index scores, meanwhile, were measured among self-identified Democrats, progressives and KSKA listeners, among women, those with household incomes under $40,000 and among the 15 percent of the Alaska population who live in communities served by the Alaska Marine Highway System, most notably Juneau and Kodiak.

Scores were also significantly low in rural Alaska and among Alaska Native respondents.

Another more specific political connection is revealed in this most recent Q3 data. While the total population shows an index score of 54, respondents who approve of Gov. Michael J. Dunleavy’s performance show a whopping score of 63, while those who disapprove of his performance are down at 47.9.

The governor’s supporters, in other words, are highly confident economically right now, while it’s all doom and gloom among his detractors.

By political ideology, conservatives had an index score in this most recent survey of 60.9, moderates 52 and progressives 46.6. So, it’s clear that perceptions of the Alaska economy are totally dependent on the ideological views of the observer.

But the good news is that all three groups were up in their scores from June; the recovery from the 51.7 mark back to 54 didn’t occur in one group at the expense of another.

Regardless of political affiliation, we all have a little more confidence now than we did earlier in the summer. Indicating perhaps that while watching politics happen is sometimes akin to watching sausage get made, when the process works and a consensus of sorts is reached, everyone wins.

The next survey will be fielded in December, with results to appear in these pages in mid-January 2020.

Ivan Moore is the principal and founder of Alaska Survey Research.

10/16/2019 - 10:19am