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Attitudes about Southeast’s business climate a bit better, but pessimism in Juneau rises in annual study
- Mark Sabbatini
- 12 minutes ago
- 7 min read
62% of regional business leaders say they’re optimistic about current conditions, but big differences in responses exist among communities and industries
By Mark Sabbatini
Juneau Independent
Southeast Alaska businesspeople are collectively feeling a bit more optimistic this year, following a sharp drop in mood last year, but mindsets vary considerably within separate communities and industries, according to an annual survey released Friday.
Wrangell is among the more upbeat after years of hard times, thanks to a proposed new shipyard and other developments, while ongoing seafood industry struggles are causing pessimism in Petersburg. Business is good for mining, real estate and tourism, while social services and manufacturing are reporting hardships along with seafood.
Such responses were provided by 360 business leaders representing about 10,000 employees in 20 communities in the Southeast Alaska Business Climate Report for 2026. The survey has been conducted annually since 2010 by Juneau-based Rain Coast Data on behalf of Southeast Conference.
The 62% of respondents with a positive view of the current business climate is up 2% from 2025, but below the 67% reported in 2024. Similarly, 67% of current respondents say they have a positive outlook for the coming year, which is 4% better than 2025 and 1% worse than 2024.
"Last year I was surprised to see just how poor the economic outlook was," Meilani Schijvens, owner of Rain Coast Data, said in an interview Friday. This year "it was just really heartening, I thought, to see there be a real movement…in terms of people who think their business or industry is getting much better or much better, and then a decline of those who feel their business or industry is getting worse or much worse."
The optimism of respondents, who were surveyed in April, is somewhat in contrast to a state report published at the beginning of the year that forecasts negative job growth for Southeast Alaska in 2026 after the region gained no jobs in 2025. The state report cites federal worker and budget cuts, plus continuing outmigration and low birth rates as the main causes.
The Rain Coast Data study states 15% of Southeast Alaska respondents plan to grow their workforce during the coming year, while 14% plan to cut jobs. It notes "job growth expectations are strongest in Hoonah and Sitka."
Primary business concerns in the Rain Coast Data study, according to an introductory summary, are rising costs and workforce challenges.
"Fuel, freight, insurance, utilities, and labor costs were among the most frequently cited barriers," the summary notes. "Housing availability and workforce recruitment continue to limit business expansion and employee retention, particularly in seasonal and skilled industries. Many respondents also noted that inflation and uncertainty surrounding government policy are contributing to more cautious decisions regarding hiring, investment, and growth."
While some of those factors are due to current events, others such as workforce and housing shortages are ongoing issues that have existed for years and are resulting in long-term outmigration. Another state study published in 2024 finds Southeast Alaska’s population is expected to drop 17% by 2050, by far the most statewide.
An indicator of those difficulties is business leaders in the Rain Coast Data study giving Southeast Alaska an overall quality-of-life rating of 6.9 out of 10, which is "down from 7.4 in 2025 and below the previous low of 7.2 recorded in 2022," the first year the question appeared in the study.
"Ratings vary across communities and industries, with Gustavus and Sitka reporting the highest ratings among communities, and the mining and energy sectors reporting the highest ratings among industries," the study notes.
The moods in communities
Juneau rose in the optimism rankings among Southeast communities despite having a lower score.
Alaska’s capital city finished seventh out of 12 communities where scores were tallied, compared to ninth of 13 communities a year ago. The 58% of Juneau respondents who said they feel "good" about the current business climate was the same as a year ago.
But a notable change is an additional 7% of respondents last year said they felt "very good," giving Juneau an overall positive score of 65%. This year there are no "very good" responses, while the "poor" response of 37% is 10% higher than a year ago ("very poor" was 6% in 2025 and 4% this year).
Schijvens said high-profile battles during the past year about Juneau’s cost of living, taxes and city government spending appear to have affected this year’s responses.
"Obviously the Juneau affordability movement and the (tax cut) ballot propositions that passed, and the loss of funding for the CBJ itself and potentially for recreation facilities," she said. "That discussion is ongoing and I feel like that's become a concern to a lot of business leaders across the community."
Among the concerns is a "loss of funding and making the community maybe smaller and less attractive is a worry for business leaders," Schijvens said.
Yakutat topped the 2026 rankings with 100% of respondents saying they feel positive about the current business climate, followed by Sitka (84%), Skagway (82%) and Prince of Wales Island (80%). Those were the same top four as a year ago, but in a different order.
A huge change during the past year is Wrangell, which finished second to last in 2025 with a 38% optimism score, which rose to just above Juneau with a 69% positive score this year. Part of the reason is a proposed shipbuilding and repair port with a projected price tag of up to $726 million, but Schijvens said there are additional reasons for the increased optimism.
"What you really have is that the community is just moving in this comprehensive, positive direction," she said. Other projects include a possible revamp of the downtown cruise dock to allow more ships and well as other industrial projects.
Hoonah also has a particularly strong future economic outlook compared to past years, "largely driven by continued tourism growth and investment associated with Icy Strait Point," according to the study.
The highest pessimism scores for current economic mood were Gustavus (62%), Petersburg (53%) and Haines (52%). Petersburg also had the gloomiest future outlook among individual communities.
"My take is it's low for two reasons," Schijvens said about Petersburg. "One, it's not a port that has large cruise ships coming to it. It has smaller-size cruise ships…And also, Petersburg is really driven by its seafood community. And we've had several tough years when it comes to the seafood sector."
The moods in industries
Mining was the most optimistic industry in Southeast with an 89% positive response rate — yet that was a drop from 2025 when it scored 100%.
Schijvens said not too much should be read into the change, as well as a couple of other industries such as health care and energy "where we just have a handful of businesses and operators."
"I think you can't really do the year-to-year comparison," she said.
Other industries with top positive scores were real estate (74%), tourism (72%), and construction/architecture/engineering (72%). Tourism was notable among those three with 11% of the positive respondents stating they felt "very good" about the business climate, 4% higher than any other industry in the study.
"Businesses continue to see opportunity in the region’s reputation for authentic small-community, wilderness experiences, and recreation, along with growing interest in cultural tourism," the study notes. "Several businesses note that Alaska is continuing to benefit from travelers seeking domestic destinations and outdoor experiences, while others point to ongoing investment in tourism infrastructure and partnerships as creating new opportunities in some communities."
Conversely, the study notes tourism operators, like many other industries, are concerned about rising costs, difficulties finding and retaining workers, and unpredictable impacts of government actions affecting operations.
The most pessimistic industries were manufacturing (100% "poor" or "very poor" scores), timber (75%) and seafood/martime (66%).
A manufacturing official responding to the survey wrote the "overall outlook for growth is downgraded to Poor due to the issue (of) a lack of entry level human resources, and the expected high cost of plant growth. The likely outcome of these challenges is to drive next phase plant development out of state."
Comments about the business climate
About half of the 63-page study consists of "open-ended" comments from 250 respondents asked to "elaborate on the outlook for your business or sector over the next year." Those responses cover a vast range of specific issues, perceived opportunities and difficulties, and perceptions about future prospects.
The wide gap in perceptions can be seen in responses by two construction industry officials:
• "There will be lots of construction related work in Juneau for small and large businesses. The future is so bright we’ll have to wear shades."
• "I’m working harder than ever and barely surviving. Inflation costs in the construction industry are spiraling upward quickly. My crew is skilled, but older, hurt and expensive. Federal taxes are eating me alive. Plumbers and electricians dominate any timeline I generate and they are very scarce."
A financial business person stated "I expect my business to grow overall and to increase staffing. However, this is due to my competitors failing or contracting and not any improvement in the economy." A mining industry worker in Juneau says the current situation is great due to high metals prices, but potential city tax increases and resistance from residents to new industry projects are concerns. There’s some praise for government actions such as deregulation being heavily pushed by the Trump administration, but also a large number of complaints from respondents about cost impacts of tariffs and war-driven oil price hikes.
The very last commenter in the study, under the industry category of "other," wasn’t optimistic about much of anything.
"In the last couple of years I have decreased my employee base from 42 to 0," the commenter stated. "This was due to the increase in cost and complexity of having employees. Higher minimum wage, sick leave calculations, regulation increases, and tax reporting and compliance issues. Employee absenteeism, lack of motivation (quite quitting), and overall decrease in working age population have exacerbated this trend. The increase in hostility from the state and local legislators toward all manners of private property, overzealous taxation, and decrease in necessary services have motivated a push to liquidate local holdings and relocate businesses out of the state."
(Disclosure: Meilani Schijvens is a member of the Juneau Independent’s board of directors. News articles about her company’s annual economic surveys of Southeast Alaska have regularly been published by Juneau and other media for many years.)
• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.
