Readers can find both an optimistic view and gloomy numbers in the borough’s annual economic conditions report, issued last month.
“With some of the lowest electrical rates in Alaska, the highest school district test scores, the potential to grow its visitor industry, the lowest unemployment rate on record, and a high level of entrepreneurship (more than a quarter of all workers are self-employed), Wrangell has potential to improve its prospects,” says the report, prepared by Juneau-based consulting firm Rain Coast Data.
However, the report also notes that a housing shortage continues to make it hard to attract and retain workers and new families to town, and that businesses face multiple other challenges — including a chronic shortage of workers. In addition, Wrangell’s population continues to age, further cutting into the available workforce.
More than one-third of residents are at least 60 years old; more than 15% are over 70. Those percentages are increasing, according to Alaska Department of Labor statistics quoted in the report.
The Labor Department projects that the town’s population, now estimated at just under 2,100, could fall to 1,724 by 2050. The report, however, adds a note to that projection: “These numbers must be understood to be projections. … Much can and will change between now and 2050. … Wrangell has opportunities to improve and diversify economic prospects.”
Part of the reason for the downward population trend, the report adds, is that “Wrangell had one of the highest death rates for the state in 2021,” twice the annual average of the past 10 years.
The community is at a crossroads, said Carol Rushmore, the borough’s longtime economic development director.
The town lost population after the timber industry shrunk and Wrangell’s two sawmills closed. Seeing a job loss and smaller population “is nothing new,” she said. “But things can change.”
Tourism looks promising, says the report. And while cruise ship visitor numbers fell during the pandemic years of 2020-2021, the trend is moving back up.
Another prospect for economic growth is expanding the town’s service industry for vessel owners. The Marine Service Center at the site of the former downtown sawmill has succeeded in drawing more services and boats to town.
The report notes that the town’s reputation for marine services has grown. “Wrangell is home to excellent craftsmen who provide services for yachters and the commercial fleet. There are people employed through shipyard activities as wooden shipwrights, fiberglass workers, machinists, steel welders, commercial painters, sandblasters and in metal fabrication, along with those with expertise in hydraulics, electronics and refrigeration.”
However, the seven-acre yard is almost maxed out on available space, Rushmore said. The option for expansion — filling in waterfront acreage — would be costly and require extensive permitting, she said.
Health care jobs are up, with the completion of the $30 million SEARHC Wrangell Medical Center in 2021 and its expansion of services.
An exception to SEARHC’s expansion in Wrangell came in January when it closed its Alaska Crossings behavioral health program for youth and moved the renamed operation to Sitka. The program employed 16 people when it closed in Wrangell, the report says. Crossings also hired several dozen seasonal workers, mostly during summer months.
The shutdown of Alaska Crossings did not make much of a dent in the town’s housing shortage. “In 2022, Wrangell had zero vacancy rates in several categories,” including three-bedroom apartments and two-bedroom homes, according to a spring statewide survey quoted in the report. The vacancy rate for one-bedroom apartments was 4%
“Business leaders identified housing as the top need to advance economic growth in Wrangell,” according to the report, based on a spring survey of Wrangell business owners. Of the 26 businesses that responded to the survey, 86% said attracting and retaining workers is difficult due to lack of housing.
The report cites seafood processing as an unknown in the town’s economic future. Trident Seafoods has not operated its Wrangell plant since 2019, citing weak chum runs.
“While the plant may still be reopened at some point in the future, there has been no indication as to when,” the report says. In addition to losing out on summer jobs, the plant closure means less money for the borough, which receives a share of the state tax on commercial seafood landings. Without the Wrangell plant, Trident runs tenders to take the area catch to processing plants in Ketchikan or Petersburg.
With the loss of Trident’s salmon-processing lines, crab has grown into a bigger share of Wrangell’s seafood industry. “While historically a salmon port, in 2021 only one-third of the Wrangell fishery was salmon. By value, crab made up approximately two-thirds of total fishery value in 2021.”
The next-biggest processor in town, Sea Level Seafoods, handles halibut, black cod and rockfish in the early season, and transitions mostly to crab and salmon.
In an indication of a weaker economy, the report says the median household income in Wrangell is significantly lower than statewide or Southeast numbers. “The median household income of $58,438 in Wrangell in 2020 was 25% lower than Alaska or Southeast Alaska. It is 10% lower than the national average. These differences are deepening over time. In 2018, Wrangell’s median household income was just 4% behind the national average.”
Quality of life and recreational opportunities rank highest as benefits to living and running a business in Wrangell, along with the local and regional culture, according to the business survey.
The report also notes that the Alaska Native population is growing as a percentage of the total population in town — at 31% in 2020 — and is higher than the statewide average and Southeast average of 26%.
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