Federal and state cuts erase Alaska private-sector job gains in June

Government job cuts outpaced private-sector growth statewide in June, leaving Alaska with 0.3 percent fewer jobs than it had a year earlier, the Alaska Department of Labor and Workforce Development reported.

The federal government accounted for the largest single year-over-year loss: 1,300 positions cut. State government, including the University of Alaska, shed an additional 600 jobs. Together, those two levels of government eliminated 1,900 positions compared with June 2025. Local government employment, which includes public schools, held flat.

Private employers added a net 1,000 jobs over the same period. Oil and gas led with 900 new positions. Transportation, warehousing, and utilities added 800. Health care and manufacturing each added 300. Government losses of 1,900 positions ran nearly double the private-sector gain of 1,000.

Leisure and hospitality fell by 500 jobs on the private side, the steepest sector decline outside government. Construction lost 300, and professional and business services dropped 200.

Alaska's seasonally adjusted unemployment rate stood at 4.4 percent in June, marginally lower than May and slightly above the national rate of 4.2 percent.

Federal Workforce Decline

The federal job losses fit a pattern economists at the University of Alaska Anchorage Institute for Social and Economic Research documented at a Commonwealth North forum on June 26. Economist Brock Wilson said Alaska had seen a 15.8 percent decline in its federal civilian workforce between April 2024 and April 2026, outpacing the national drop of 14.8 percent. "Alaska is quite high in that, probably about the 8th largest decline," Wilson said of where the state ranked among states shedding federal workers.

Workforce Planning

State workforce planners are working within this shift. The Alaska Workforce Investment Board and the Department of Labor released a draft workforce plan for 2026 and 2027 that sets five strategic priorities, including expanding career pathways and improving access for rural and underserved workers. The plan states its goals are to support "a system that is responsive to employer demand while expanding access to skills and employment opportunities for Alaskans."

Gov. Mike Dunleavy appointed Cathy Munoz as acting commissioner of the Department of Labor and Workforce Development earlier this year. The department's next monthly employment report will cover July figures.