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For centuries, Southeast Alaska's economy has developed around exports of natural resources. Fur trading supported Russian colonization, while in later years, mining stimulated growth along Southeast's mineral-rich mainland and neighboring islands. Fishing and timber grew to become important export industries: More than 80 canneries operated in the region in the 1920s, and large pulp mills opened in Ketchikan and Sitka some 30 years later.

Fishing and timber remain important components of Southeast's economy. In 1988, for example, commercial fishermen harvested 190.6 million pounds of fish with a value of more than $209 million. During the same year, just over 790 million board feet of lumber was harvested, most of it from the Tongass National Forest and Native corporation lands. The harvest was the region's largest in nine years.

During the summer of 1988, 332,270 tourists visited Southeast, approximately 200,000 of them by cruise ship. By the time visitors caught their last glimpse of calving glaciers and humpback whales, they had spent $74 million in the region.

Those who regularly check the health of Southeast's economy say such diversity is the region's best defense in times of economic malaise. In the last 15 years, almost every major industry in the region has recovered from at least one boom-bust cycle, with others sure to follow. Southeast's economy is closely tied to the world's natural resource markets, with seafood, timber and minerals all subject to international market forces.

According to a 1991 report produced for the Southeast Conference, a regional economic development organization, the tourism industry can expect slow but steady long-term growth. State and regional tourism officials are working in Southeast and across the state to lure visitors to Alaska in the off-season, an effort they say could generate jobs and economic impact.

Things are less certain for those in the seafood and timber industries. Recent low prices have hurt fishermen and processors, and employment in Southeast's forest-products industry is declining -- down more than 500 jobs between 1990 and 1991.

An area of almost certain growth, however, is the mining industry. First in a recent resurgence of activity, Greens Creek Mine near Juneau began operations in 1989 and by 1991 employed approximately 250 workers. Although silver is the main mineral mined at Greens Creek, commercial quantities of lead, zinc and gold also have been recovered.

Echo Bay Mines is in the final stages of seeking the permits necessary to open two major mining operations. The Alaska-Juneau Mine in downtown Juneau and the Kensington Mine between Juneau and Haines could be in full construction phases by 1993, says Jim Kohler, executive director of the Southeast Conference. Other promising mining sites include two gold mining projects northeast of Juneau just over the Canadian border (Juneau could serve as a staging and supply center) and on Prince of Wales Island.

Kohler compares Southeast's economy to a stool supported by many legs: Should one leg become wobbly, there is good reason to believe the others will be able to support it, at least in the short term. "Southeast has the potential for the most stable and sustainable economy in the state," says Kohler.

Fishing, timber, mining, tourism and government, along with a strong service industry, give Southeast a diversity not found in many other regions of the state. The Alaska Department of Labor predicted in 1991 that the next two years could bring growth and prosperity to some Southeast industries (construction, services), while others likely will face flat or lackluster performances (seafood processing, timber).


Archaeologists believe that the southern end of Southeast Alaska, near Ketchikan, has been inhabited for some 10,000 years. Much later, perhaps 1,500 years ago, Tlingit Indians entered the lush archipelago from Canada and Interior Alaska to make a home in Southeast. Later, the forested islands and shoreline also attracted Haida and Tsimshian Indians. By the middle of the 18th century, Southeast's coastline was heavily populated, though no white man had yet visited.

Under the command of Vitus Bering, Russian explorers first spotted Prince of Wales Island in July 1741. Word spread of the area's rich furs, and between 1774 and 1800, ships from Spain, Britain, France, Russia and America plied the waters of Southeast.

By 1799, Russians had established themselves in Yakutat and Sitka. In 1825 the Anglo-Russian treaty established the boundary between Alaska and Canada, and in 1867 the United States purchased Alaska from Russia.

From there, Southeast's history becomes a mosaic, with each community providing its piece of the colorful design: Wrangell became the only Alaska city to exist under three flags -- Russian, British and U.S.; Presbyterian missionaries arrived in Haines in the late 1800s, followed by the U.S. Army in 1904 and its establishment of Fort William H. Seward; as a sign of things to come, Juneau hosted the state's first political convention in 1881 and became the seat of government 25 years later; Canada's Klondike gold rush of 1897-98 lured thousands of would-be prospectors and fortune-hunters north, many of them streaming through Skagway on their way over the Chilkoot Trail.

The region's more recent history is marked by the arrival of the U.S. Coast Guard, jet service and the ferries of the Alaska Marine Highway System, and by developments in the fishing, timber and mining industries.


The introduction to a popular tour book on Southeast sets the stage: "There are 10 million acres of forest in Southeast Alaska, 1,000 islands, 10,000 miles of shoreline, 50 to 70 major glaciers, 25,000 brown bear, 15,000 bald eagles, and 64,000 people," writes author Sarah Eppenbach.

Alaska's Southeast panhandle is precariously connected to the rest of the state by glaciers and jagged shoreline. This narrow strip of land and string of islands encompasses an area about the size of New York state and represents 6 percent of Alaska's land mass, extending 550 miles from Dixon Entrance near Ketchikan, north to Icy Bay on the western edge of Malaspina Glacier.

The entire Southeast region is bounded on the north/northeast by the St. Elias and Coast mountains and by the U.S.-Canadian boundary they help form. To the west/southwest, the region is bounded by the Gulf of Alaska and the Pacific Ocean. Six of the state's 10 largest islands are in Southeast, with Prince of Wales Island at the southern end of the Panhandle the third largest in the United States.

Seventy-three percent of Southeast is covered with dense forests, including the 16.8-million-acre Tongass National Forest, which is made up primarily of western hemlock and Sitka spruce. Where there aren't trees, there's ice, with four major icefields sprawled across parts of the region. Glacier Bay contains 16 active tidewater glaciers, while towering cliffs of blue granite greet visitors to Misty Fiords National Monument. Major rivers originate in Canada, including the Chilkat, Taku and Stikine.


Two words best describe Southeast's weather: cool and damp (also translated as just plain wet). Warm ocean currents mean comparatively mild temperatures with summer averages in the 60s and winter temperatures rarely below zero.

Precipitation -- mostly rain -- is heavy, with annual averages ranging from 26 inches in Skagway to 227 inches at Little Port Walker on Baranof Island. Not surprisingly, Little Port Walker also holds the state record for receiving the most precipitation in a 24-hour period, with 14.84 inches falling on Dec. 6, 1964.

It's estimated that Ketchikan has 224 rainy days a year, with an additional 100 described simply as cloudy. This fishing community at the southern end of the region receives an average 162.23 inches of rain a year, as much as Fairbanks receives in 15 years. (Some sources put the average at 154 inches of precipitation a year.) And according to at least one tour book, the winds in Yakutat are at times so fierce that parents have been known to tie their children together when sending them off to school.

Conditions in Ketchikan include:

* Average summer temperature range is 48 degrees to 66 degrees F.

* Average winter temperature range is 30 degrees to 42 degrees F.

* Extreme temperatures are -8 degrees and 96 degrees F.

* Average annual precipitation is 154 inches (includes 33 inches of snow).

Conditions in Petersburg include:

* Average summer temperature range is 45 degrees to 64 degrees F.

* Average winter temperature range is 22 degrees to 37 degrees F.

* Extreme temperatures are -19 degrees and 84 degrees F.

* Average annual precipitation is 106 inches (includes 103 inches of snow).

Conditions in Juneau include:

* Average summer temperature range is 47 degrees to 63 degrees F.

* Average winter temperature range is 25 degrees to 35 degrees F.

* Extreme temperatures are -10 degrees and 87 degrees F.

* Average annual precipitation is 91 inches (includes 94 inches of snow).


As discussed earlier, Southeast's economy is based largely on the export of natural resources (seafood, timber, minerals), allowing the region to enjoy a diversity not found in many parts of the state. A strong service industry and employment created by local state and federal governments also add to the mix.

Individual communities have their strong points: Juneau is a government town; Ketchikan's economy relies heavily on fishing, fish processing and tourism; Petersburg and Yakutat depend on fishing as the economic mainstay; Sitka's economy is bolstered by health care, education and tourism.

According to the Alaska Department of Labor, government provided 37 percent of the jobs in Southeast in 1991, while the service, trade and manufacturing industries provided 17 percent, 16 percent and 14 percent, respectively. The region's labor force was pegged at 35,592 in 1991, with a regional unemployment rate of 8.4 percent. Within the region, the unemployment rate fluctuated from a low of 6 percent for the Juneau Borough to a high of 17.1 percent for the Haines Borough. Haines' high unemployment rate was the result of the 1991 closing of the local sawmill.

The following are the region's labor force and unemployment rate statistics for 1991 as provided by the Alaska Department of Labor: Haines Borough, 935 workers, 17.1 percent; Juneau Borough, 15,689 workers, 6.0 percent; Ketchikan Gateway Borough, 6,702 workers, 9.9 percent; Prince of Wales-Outer Ketchikan, 2,787 workers, 13.7 percent; Sitka Borough, 4,099 workers, 6.3 percent; Skagway-Yakutat-Angoon, 1,740 workers, 13.7 percent; and Wrangell-Petersburg, 3,640 workers, 9.5 percent.


Juneau, the state capital, serves as the main commercial center for the

northern part of Southeast, with Ketchikan serving a like role for the region's southern communities. Located TABULAR DATA OMITTED about two hours by air from Seattle and 80 minutes from Anchorage, Juneau is the regional hub for commerce, transportation, medicine, retail outlets and government services. It serves as the trade center for Haines, Skagway, Angoon, Hoonah, Gustavus and Yakutat. Between January and May, Juneau is home to the Alaska Legislature.

In addition to the state government, Juneau also accommodates several offices of the federal government, including branches of the Forest Service, National Park Service, Bureau of Indian Affairs, the U.S. Postal Service and the Coast Guard. The University of Alaska Southeast also is located in Juneau.

The city, sometimes referred to as Little San Francisco because of its steep streets, has everything from cafes and diners to a French bakery and outdoor salmon bake. Until 1980, the city's downtown business district claimed 75 percent of the city's retail sales. More recently, new shops and malls have moved to the Mendenhall Valley and the Lemon Creek areas, luring shoppers away from city center.

Ketchikan, 90 minutes by air from Seattle, 50 minutes from Juneau and two hours from Anchorage, is the regional transportation and service hub for those living in Southeast's southern region. It also is home to several tourism-related businesses and is the first port of call for northbound cruise ships. In addition to city government and borough offices, several state and federal agencies have offices in Ketchikan. Federal offices include the Forest Service, Coast Guard, Customs, Department of Health and Human Services, Fish and Wildlife Service and Federal Aviation Administration.

While not considered a commercial center, Sitka has become a regional hub for education and health care. Educational facilities include Mt. Edgecumbe, a state-run boarding school for Alaska Native students, Sheldon Jackson College and a branch of the University of Alaska Southeast.

Sitka was the site of the state's first hospital, built while the city was still a Russian trading post. Today, two hospitals and a state-run Pioneer Home represent the health care industry. Combined, these facilities employ more than 400 people. With the addition of health care providers in private practice, the industry accounts for one in every nine jobs in the city. The state Department of Labor considers the percentage quite high, because statewide only one in 23 jobs are in the health care industry.


Approximately 70,000 people -- or 12 percent of the state's population -- live in Southeast. Residents are scattered among some 33 coastal communities, although 85 percent of them live in one of the region's five largest cities -- Juneau, Ketchikan, Sitka, Petersburg and Wrangell. Smaller communities range in size from more than 1,000 to just a handful of year-round residents.

Eleven Southeast communities have a substantial Native population and one, Metlakatla, is Alaska's only federally organized Indian reservation. Sealaska Corp. is the area's regional Native corporation; Central Council Tlingit and Haida Indian Tribes serves as the regional Native non-profit organization. Twelve village Native corporations operate throughout Southeast.

The following 1990 census figures give a snapshot of the region's demographics:

Haines Borough

* Population: 2,117 (1980: 1,680)

* Median age: 34.5 years

* Proportion of population under age 18: 28 percent

* Eskimos, Aleuts and American Indians account for 13.2 percent of the population.

* Median value of a home: $81,000

* Per capita income: $37,548 (1989)

Juneau Borough

* Population: 26,751 (1980: 19,528)

* Median age: 32 years

* Proportion of population under age 18: 29 percent

* Eskimos, Aleuts and American Indians account for 12.9 percent of the population.

* Median value of a home: $113,500

* Per capita income: $25,075 (1989)

Ketchikan Gateway Borough

Includes Ketchikan and Saxman.

* Population: 13,828 (1980: 11,316)

* Median age: 32 years

* Proportion of population under age 18: 30 percent

* Eskimos, Aleuts and American Indians account for 13.7 percent of the population.

* Median value of a home: $112,600

* Per capita income: $26,530 (1989)

Prince of Wales-Outer Ketchikan Census Area

Includes Craig, Hyder, Hydaburg, Kasaan, Klawock and Thorn Bay, among others.

* Population: 6,278 (1980: 3,822)

* Median age: 30 years

* Proportion of population under age 18: 32 percent

* Eskimos, Aleuts and American Indians account for 37.6 percent of the population.

* Median value of a home: $63,300

* Per capita income: $16,986 (1989)

Sitka Borough

* Population: 8,588 (1980: 7,803)

* Median age: 30 years

* Proportion of population under age: 18: 31 percent

* Eskimos, Aleuts and American Indians account for 20.9 percent of the population.

* Median value of a home: $120,000

* Per capita income: $23,995 (1989)

Skagway-Yakutat-Angoon Census Area

Includes Angoon, Hoonah, Pelican, Skagway, Tenakee Springs and Yakutat, among others.

* Population: 4,385 (1980: 3,478)

* Median age: 31 years

* Proportion of population under age 18: 33 percent

* Eskimos, Aleuts and American Indians account for 38. 1 percent of the population.

* Median value of a home: $65,200

* Per capita income: $21,207 (1989)

Wrangell-Petersburg Census Area

Includes Kake, Petersburg, Port Alexander and Wrangell, among others.

* Population: 7,042 (1980: 6,167)

* Median age: 32 years

* Proportion of population under age 18: 31 percent

* Eskimos, Aleuts and American Indians account for 19.4 percent of the population.

* Median value of a home: $91,700

* Per capita income: $22,862 (1989)


Not surprisingly, the lifestyle of most Southeast residents is determined by the area around them, as well as by the field in which they work. For many, life revolves around the region's primary industries, including fishing, timber and tourism. Those in smaller communities lead a primarily subsistence lifestyle. Popular pastimes in the region include water-oriented activities such as sport fishing, motor boating or kayaking, as well as land-based activities such as hunting, hiking and beachcombing.

The lifestyle in Juneau is perhaps more cosmopolitan than in other parts of the region, and residents there enjoy sailing, downhill and cross-country skiing, attending live theater and participating in organized sports. Juneau's lifestyle is definitely colored by the diversity of those who live in and visit the city -- politicians, fishermen and tourists. Longtime residents insist that Juneau is still a small town at heart and relish the thought that a 10-minute walk from city hall puts you in the woods.


Residents and visitors alike have two choices when it comes to getting around most of Southeast: either fly or take a boat. Only two Southeast communities, Haines and Skagway, are connected by highway to the rest of the state.

There are 87 miles of roadway in and around Juneau, but when all's said and done, you'll still end up back in Juneau. With some 2,000 miles of roadway, Prince of Wales Island has the region's most extensive road system allowing travel between most established communities.

The White Horse & Yukon Route Railroad, completed in July 1900, ran between Skagway and Whitehorse, British Columbia, until 1982. Today, the line offers summer-only excursion trips to White Pass Summit and combination train/bus trips through to Whitehorse.

Daily jet service connects several Southeast communities with each other, as well as with Anchorage and Seattle. Commuter air services also operate in the region, allowing travelers to get most anywhere.

Perhaps the most common mode of transportation, however, is aboard one of the state-run ferries serving Southeast. The year-round service hauls passengers and cargo along water highways up and down the Panhandle and also connects the region with Seattle and Prince Rupert, B.C. The Alaska Marine Highway System began operations in 1963, although some areas, including Prince of Wales, did not receive service until much later.

Wrangell is a transportation hub for mineral activity across the border, and Skagway is the point of tidewater shipping for lead and zinc ores produced in Canada's Yukon Territory.

The Juneau Empire is the area's dominant newspaper, with other newspapers also published in Haines, Sitka, Ketchikan, Petersburg, Skagway, Wrangell and Thorne Bay. According to the Alaska Blue Book, 16 radio stations, including 6 public stations, operate in Southeast, along with 3 television stations, 1 of which is a public station.


Tourists have been visiting Southeast since shortly after the great naturalist John Muir first came to the area in 1879. His descriptions of the region were so compelling that by 1883 steamship companies were offering summer tours up the Inside Passage.

One of the first passengers was a young journalist whose reports of the voyage appeared in publications across the country. Since then, millions of visitors have traveled to Southeast, where Ketchikan is the first port of call.

The splendor of the area, in addition to the wide variety of services and activities, continues to draw increasing numbers of visitors. From Ketchikan's 14 totems and community house at Totem Bight State Historic Park and the August Blueberry Festival to Skagway's devotion to the gold rush era, Southeast offers something for most everyone. Humpback whales swim the waters of the 3.3-million-acre Glacier Bay National Park and Preserve, while at the Chilkat Bald Eagle Preserve outside Haines the largest known concentration of bald eagles in the world gathers each fall, often numbering up to 3,500.

In addition to serving as the state capital, Juneau is the site of the Alaska State Museum, Eaglecrest Ski Resort, Mendenhall Glacier and annual folk, jazz and classical music festivals.

Sitka also offers visitors a wealth of cultural activities, from the June Sitka Summer Music Festival to exhibits at two museums and October Alaska Day celebrations. The All-Alaska Logging Championships and the Alaska Rapture Rehabilitation Center also draw their shares of travelers.

Petersburg, with its strong Norwegian influence, offers great trumpeter swan viewing in the fall and winter, an October arts festival and the Little Norway Festival each May. In addition to national parks, preserves, monuments and wilderness areas, Southeast has 30 state parks, recreation areas and marine parks.


Following is a list of the incorporated cities and villages throughout Southeast, their forms of government and tax rates. Included are communities of 200 or more residents, based on the 1990 census.

* Haines Borough: Third-class borough; mayor/assembly government; 1 percent sales tax

* City of Haines: First-class city; mayor/council government; 4 percent sales tax

* Juneau, City & Borough of: Unified home-rule municipality; mayor/assembly government and city manager; 4 percent sales tax; 7 percent bed tax

* Ketchikan Gateway Borough: Second-class borough; mayor/assembly government and borough manager; 1.5 percent sales tax; 4 percent transient occupancy tax

* Ketchikan: Home-rule city; mayor/council government and city manager; 3.5 percent sales tax; 4 percent transient occupancy tax

* Saxman: Second-class city; mayor/council government; 5 percent sales tax

* Sitka, City & Borough of: Unified home-rule municipality; mayor/assembly government and city manager; 4 percent sales tax; 4 percent bed and liquor taxes

* Angoon: Second-class city; mayor/council government; 2 percent sales tax

* Craig: First-class city; mayor/council government; 4 percent sales tax; 6 percent liquor tax

* Hoonah: First-class city; mayor/council government; 4 percent sales tax; 8 percent liquor tax

* Hydaburg: First-class city; mayor/council government and city manager; 4 percent sales tax

* Kake: First-class city; mayor/council government; 5 percent sales tax

* Klawock: First-class city; mayor/council government; 3 percent sales tax

* Pelican: First-class city; mayor/council government; 3 percent sales tax

* Petersburg: Home-rule city; mayor/council government and city manager; 6 percent sales tax; 3 percent bed tax

* Skagway: First-class city; mayor/council government and city manager; 4 percent sales tax; 6 percent bed tax

* Thorne Bay: Second-class city; mayor/council government; 3 percent sales tax

* Wrangell: Home-rule city; mayor/council government and city manager; 7 percent sales tax; $3 per night per room tax

* Yakutat: First-class city; mayor/council government; 3 percent sales tax


Much of the land in Southeast is publicly owned, with federal holdings accounting for 83 percent of the region's land area. Of the 24 million acres in Southeast, approximately 17 million are in the Tongass National Forest, the largest national forest in the country. Glacier Bay National Park and Preserve contains an additional 3 million acres.

State and municipal land ownership totals about 500,000 acres. Southeast's largest private landowners are the regional and village Native corporations created under federal law in 1971.
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Title Annotation:Know Alaska
Author:Hill, Robin Mackey
Publication:Alaska Business Monthly
Date:Jun 1, 1992
Previous Article:Expansion continues.
Next Article:Processing ups value of timber resources.

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