Metal Mine Economic Facts

Starred (*) items include coal & quarrying

Economic numbers are often surprising slippery.  Industries are open systems and statistics are partly a function of how they are measured (for instance, the U.S.. government counts as unemployed only those who are actively seeking work).  

Job Numbers: A Difficulty of Measurement  

Alaska has around 2,000 "direct" metal mining jobs: people who are employed by a metal mining firm.  Mines may purchase goods and services from from other Alaskan vendors, generating "indirect" jobs, and mine workers and vendors may spend their pay on other products and services, supportinng "induced" jobs.  

Even measuring direct job creation isn't straightforward: for instance, is an 8-month contract considered 1 job, or 8/12ths of a job?  If a job averages 80 hours per week, is that 1 job, or should that be 2 jobs since it's twice as much work?

Measuring indirect and induced jobs is much more difficult.  Economists and statisticians usually rely on a "factor" to estimate these jobs, rather than actual data.  It is common to assume a 1 indirect or induced job is created for every 1 direct job.  This method relies a vague generalizing principle, and probably has serious accuracy problems - especially at a scale as small as Alaska's metal mining industry.

Industry Value Produced: Meaningful, or Not?

The large majority of Alaska's $3+ billion / year mining production likely comes from metal mining, although hard data could not be sourced for this article.  Alaska's sole coal operation is probably worth $50 to $100 million per year (~$73 million in 2010).  Quarrying is unlikely to generate massive value in Alaska, since gravel & other common quarry rocks are abundant low-price resources.

Alaska metal mining's total annual production value probably has limited relevance to Alaska's economy and residents.  Alaska's major mines account for the lion's share of production, and are mostly owned outside the state.  Profits are exported out-of-state, and many mine costs are paid to out-of-state vendors or administrators.   Total industry value and profitability may be very import to Alaska's economy indirectly, insofar as it strongly influences out-of-state owners to explore, open, expand, or close mines in Alaska.  This cascades into Alaskan jobs and economic activity.

From the perspective of Alaska's residents and internal economy, the mining industry's payroll for Alaska-based workers and expenditures on Alaskan products and services may be much more important.  This information is generally proprietary.

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