My Story of Alaska’s Economy in 1987

    It was June, 1987.  I was driving North on the Alcan Highway moving to Alaska.  Little did I know about the Last Frontier, like how its economy was strongly tied to oil, gas, fishing, and tourism.  I was leaving a comfortable lifestyle in Salt Lake City.  I worked at Snowbird Ski Corporation as a hostess at the Steak Pit and a sushi restaurant.  I made good money for a ski bum, had plenty of food to eat, cheap rent, a car with insurance,  a seasons ski pass.  I even had health insurance provided by Snowbird which is rare at ski resorts these days.
    My friend, a dishwasher, was heading back to Alaska that summer and I decided to go on an adventure. So I sold my car and put most of my belongings into storage. My friend convinced me I would find work.  My options were many.  At Denali Park, (tourism), or on a boat, (fishing).  He even told me about the North Slope jobs, (oil).
    On our way, as we approached  Alaska, caravans of cars, trucks, motor-homes and trailers were leaving the state.  It looked as though there was a plague and we were heading right for it.
    We drove for seven days heading for my future home in Girdwood.  I remember  driving  through Anchorage and Palmer  and seeing signs plastered all over many big buildings.  “For lease”, “For Rent”, “For Sale”.  So what did all of this mean?
    Let me go back in time to explain.  Alaska’s annual home price appreciation rate was a healthy 41.80% in 1981.  By 1986, it began to slide to -3.73% appreciation rate.  Also in 1986, Saudi Arabia increased its oil export.  The well head price of U.S. crude fell from $24 to $12.  Luckily, Alaska received $2.7 billion in petroleum revenue of which 86% went into the general fund.
    Now it’s 1987 and the housing market bubble is beginning to burst.  First, oil prices completely collapse and the general fund receives half of the money of the previous year.  The the stock market crashes in October, called “Black Monday”.  Alaska’s home annual appreciation rate falls to -23.42%.
    My future in Girdwood  looked bleak that summer.  My friend, also a carpenter, couldn’t find any work.  I, however, found two jobs!  A waitress at a coffee shop and a cashier at the local video store (tourism).
    As the 1980’s progressed and Alaska bounced back from this crash, oil history supply and demand continued a rocky path.   North Slope production peaks in 1988.  Then the Exxon Valdez spills it all out in 1989.  Interestingly, the Persian Gulf War begins in 1990.  But that’s another decade and another story.

                                                          Julie Garrigus