Alaska’s three major cities continue to have higher living costs than most of the nation’s urban areas, according to a newly released analysis published by the Alaska Department of Labor.
Juneau, Anchorage and Fairbanks are in the top 25 among 257 metropolitan national areas. Among the three, Juneau had the highest overall cost of living, at 31.7% above the national urban average in 2025, according to the analysis, published in the July issue of Alaska Economic Trends, the department’s monthly research magazine.
The report did not look at other communities in Alaska.
Anchorage’s cost of living was 25.5% above the national average, while Fairbanks’s costs were 22.9% higher, according to the analysis.
While significantly higher than the national urban average, the Alaska cities last year were much cheaper than cities like New York, where Manhattan has overall living costs 139% above the national average, or Honolulu, where overall costs were 83.9% above the average.
The Alaska cities’ rankings are driven in large part by two categories — health and groceries.
Alaska’s three major cities continue to have some of the nation’s highest health care costs, according to the 2025 statistics.
Anchorage had the third highest health costs, at 42.7% above the national average, followed by Juneau at 39.5% and Fairbanks at 35.4%, according to the statistics.
The three cities also continue to have significantly higher grocery costs than other U.S. cities, according to the analysis. In Juneau, grocery costs in 2025 were 28.4% above the average. Anchorage’s grocery costs were 23.7% higher, while groceries in Fairbanks ran 23% above the average.
Fairbanks had modest costs in one important category in 2025. Housing costs last year in the Interior city were actually 1% lower than the national urban average, the analysis found. But that is more than offset by the high costs of energy — with utility costs that were 113% higher than the average, according to the analysis. Fairbanks had the highest utility costs of all the metropolitan areas in the study group.
The calculations reflect conditions before the U.S. invasion of Iran, which started at the end of February and which have caused energy costs to spike.
Even before the Iran war, Alaska had higher energy prices. Gasoline prices in urban Alaska averaged $3.66 a gallon in January, compared to the national average of $3.10. Costs in rural Alaska were much higher, with six villages in Western or Interior Alaska posting average January gasoline prices above $10 a gallon.
The numbers showed gasoline and heating fuel in Wrangell was about $1 higher than the national average in January, but less than half the cost of many villages in rural areas of the state.
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