The Alaska seafood industry is rocking in the wake of COVID-19
In the summer, the Alaskan fishing industry comes to life; from within the state and from all over the world, workers flock to Alaska’s coastlines to fish for pollock, salmon, crab, and other fruits of the sea.
This year, the fishing industry is left rocking in the wake of the fallout of COVID-19.
“I think it’s useful to think about this in two dimensions,” says Brett Watson, Postdoctoral Researcher at the University of Alaska Anchorage Institute for Social and Economic Research (ISER). The two dimensions, he says, are seafood supply and demand.
Watson says that the global lockdowns as a result of COVID-19 have dried up demand for products like Alaskan seafood. “We eat a lot of seafood in Alaska, and so that’s an important source of consumption for seafood products, but most of that is getting sold outside,” Watson says. He references East Asia, which is a large importer of Alaskan seafood, as an example.
He goes on. “A typical place that you might consume a high-value a product like Bristol Bay wild caught salmon, would be at a nice restaurant,” Watson says. “Given what’s happened to the restaurant industry in the United States and around the world, there’s a big shock to what’s going on to demand for high-quality seafood product like that.”
“COVID has provided a big negative shock to global demand,” he adds.
On the supply side the fishing industry, Watson uses an example which appears to parallel the current situation meat-processing plants in the contiguous United States are being reported to experience.
“There was a cluster outbreak at this seafood processing facility in Whittier,” he says, referring to 11 seafood workers from the Whittier Seafood facility who tested positive in early June.
“There’s this logistical problem that COVID creates where employees are potentially getting infected, what type of quarantine procedures the employees have to undergo when they arrive, how are they transporting employees from the Anchorage airport out to Bristol Bay, how are the employees getting housed once they’re there, how are they limiting interaction between the bunk houses there and the city of Dillingham, for example…” Watson explains that companies must tackle all of these extra hurdles which have come with COVID-19.
“Those are the two forces; you’ve got this negative demand shock and then this negative supply shock which creates a lot of headwind for the industry,” Watson says.
When it comes to the Alaskan economy, Watson’s research has yielded evidence that about 50 more cents over every dollar made by Alaskan fishers circulates in the economy (if they spend it in-state).
Theoretically, this translates into that extra 50 cents per dollar moving from the fisher into other establishments and throughout the Alaskan economy. Less money in the fisher’s pocket means less money circulating through the economy.
To put this into context, a report from the McDowell Group says that in 2017, the Alaskan seafood industry generated $1.7 billion in wages. Although many fishing industry workers are not Alaskan, this still makes fishing a significant part of the Alaskan economy.
Watson cautions that it is still too early to tell exactly what will happen within the fishing industry. “There’s still a lot of uncertainty,” he says. “But things are changing pretty fast.”