U.S. Commission on Civil Rights

Racism's Frontier: The Untold Story of Discrimination and Division in Alaska

Chapter 3

Economic Opportunity and Employment

With regard to . . . equality of rights, I suppose we could say we have that on paper. But the fact is that so many of those rights are driven by economics and our economics are far from equal.[1]

Alaska's economy is unique due to geographic and cultural influences, as well as its reliance on the state's abundant natural resources. Over the last century, the character of Alaska's economy has changed dramatically, from a primarily subsistence economy to a market economy based on the sale of natural resources and the provision of services. Today, the state's economy is expected to simultaneously support the two systems, which are often at odds, resulting in a pronounced urban/rural economic divide and a huge disparity in income across the state.

Rural Alaska is made up of many remote communities that rely on both a market or cash-based economy and a subsistence or non-cash economy. Together, these economies determine the economic well-being of the community.[2] The market economy in these rural areas relies on the public sector for employment and funding, but because of the high cost of services and goods, cash quickly leaves these communities. Thus, many households in rural Alaska engage in subsistence activities, usually measured in pounds of harvested fish and game, which from an economic perspective can be viewed as employment.[3]

Alaska's market economy is centered in the state's few large urban communities that bring money into the state and generate monetary growth. These urban centers rely heavily on profits from the natural resources extracted from rural Alaska, but frequently do not contribute to the local economies where the resources come from.[4] It should also be noted that Alaska is highly dependent on the production of oil. On one hand, the state's oil resources have created enormous wealth, but on the other, dependence on this single source of income has the potential to create economic havoc in periods of declining oil prices. Approximately 85 percent of state governmental revenues are fueled by oil sales, so any significant series of events affecting the market price of petroleum produces shock waves throughout the state. [5]

One economist who spoke before the SAC noted that the economies in communities across the state are varied, and no single economic model is appropriate across the board. He stated:

Every community is different in terms of having a natural resource available to them, having leadership, having special infrastructure capacity that would allow some communities to develop an economic base. And I think there are examples where that has happened, is happening in Alaska. . . . I think that because of the small size of communities, subsistence will always be a necessary element to an economy, if not a preferred desirable element, because small economies just cannot support a lot of jobs.[6]

Unemployment rates generally serve as a key indicator of economic stability and growth, but in Alaska this may not be a true measure of opportunity or livelihood. The method by which unemployment is measured counts only individuals who are actively looking for work. Individuals who participate in subsistence living as a main source of employment are not counted as unemployed, and thus the figures reported on unemployment in the rural areas may underestimate the actual market-based unemployment rates. According to one economist, because of subsistence, a year-round full-time job is not the goal for many rural Native job seekers. He argues that because the number of people looking for work in the market economy depends on the seasonal pattern of subsistence activities, the unemployment rate would be better measured by deficit hours rather than persons.[7]

Nonetheless, in rural Alaska there is an employment deficit, even allowing for hours spent on subsistence activities. In fact, statewide, Alaska's economy has taken a downturn in recent years, but the impact has resonated in rural more than urban communities. Average annual per capita income has fallen from among the highest in the nation to average. At the same time, urban cost of living has also decreased, masking the economic decline. For rural areas, on the other hand, where the cost of living remains high, the drop in income has had a devastating effect.[8] One-fifth of Native families live below poverty as compared with 7 percent of all families in Alaska. There is little economic development, employment, or income in remote Native villages. In some communities, the unemployment rate exceeds 80 percent. In addition, the high cost of living in villages has forced residents to rely heavily on public assistance.[9]

The rate of job growth in Alaska has slowed to levels of the early 1980s, and new jobs can mostly be found in lower wage trade and service sectors.[10] The number of jobs in higher paying resource industries of oil, seafood, timber, and mining is no higher than it was 20 years ago. Economic experts predict that the future will bring more job openings due to the retirement of employees hired during the economic boom of the 1970s, than to economic growth.[11] It is also predicted that the number of young Native Alaskans entering the job market in the coming decade will increase by as much as 50 percent. However, the majority of Natives live in rural communities where market-based jobs are limited and job growth is expected to slow.[12]

Minorities in urban Alaska are not immune to the economic hardships faced by the rest of the state. In Anchorage, the disparity in socioeconomic conditions is not only felt by Alaska Natives; other people of color continue to face these challenges. According to the president of the Anchorage NAACP, there is very little economic opportunity for African Americans and other minority groups. African Americans have difficulty securing jobs and when they do, often they are not given the opportunity for promotion to higher positions.[13] This pattern can be seen in state, federal, military, and private sectors. The NAACP president noted: All one needs to do is walk into these various businesses to see where minorities are strategically placed and the positions that minorities hold. [14]

The poor economic condition of many urban minorities in Alaska has resulted in higher rates of destitution and homelessness. A representative from the Alaska AIDS Assistance Association stated that 30 people each year freeze to death in Anchorage, primarily Alaska Natives and other minorities.[15] She added that many of the people who are now homeless came from villages where they subsisted on hunting and gathering, but with restrictions placed on these activities they became unable to survive and were forced to move to unfamiliar urban areas.

EMPLOYMENT TRENDS

To gain an understanding of the employment status of minorities in Alaska, and because employment is such a large indicator of economic stability, the SAC invited several key employment experts to participate in its forum. Although invited, the U.S. Department of Labor's Office of Contract Compliance Programs did not participate on the employment panel, and the director of the U.S. Equal Employment Opportunity Commission's district office with jurisdiction in Alaska was unable to attend the two-day forum, although she addressed the SAC in its planning meeting the evening before the forum. Thus, the employment statistics provided focus more on public sector employment than private.

The racial and ethnic composition of Alaska's overall labor force, according to data collected by the U.S. Bureau of Labor Statistics, is as follows: 82.2 percent white, 3.0 percent African American, 9.6 percent Alaska Native and American Indian, 4.0 percent Asian and Pacific Islander, 1.2 percent other, including Hispanic.[16] In June 2001, Alaska's total civilian labor force, including all individuals 16 years of age or older, was nearly 335,000, almost half (44 percent) of which was in the Anchorage area.[17] The state's official seasonally adjusted unemployment rate in June 2001 was 5.8 percent, whereas the rate for the United States as a whole was 4.5 percent.[18]

A large percentage of Alaskans are employed in the public sector. Federal, state, and local government agencies employed 73,800 people in June 2001; nearly 22,000 individuals are employed by the state government alone.[19] The executive branch of the state government employs more than 14,000 permanent employees, including full-time, part-time, and seasonal workers. The state also employs more than 3,500 nonpermanent employees (which will be discussed in greater detail below).

When looking at the total number of people employed by the state of Alaska, it appears that the state has hired minorities in numbers greater than their proportion in the overall work force. The commissioner of the State Department of Administration indicated that the state is exceeding expectations in this regard.[20] The state of Alaska permanent executive branch work force has, in fact, seen an increase in minority employment over the past decade.[21] In 1990, the executive branch was composed of 15.5 percent minority employees, but as of June 31, 2001, the percentage had increased to 18.0 percent.[22] However, as table 3 illustrates, despite the increase, minorities remain underrepresented. In addition, when disaggregating permanent employees from nonpermanent employees, and full-time, part-time, and seasonal employment the numbers tell a different story. The following tables demonstrate that there are patterns in state employment.

Of the permanent executive branch employees, 5.3 percent are Native Alaskan, 5.1 percent are Asian American, 3.5 percent are African American, 2.3 percent are Hispanic, and 1.6 percent are American Indian.[23] The largest concentrations of all minority employees in the state executive branch can be found in the administration, health and social services, and revenue divisions. The largest percentage of Alaska Natives can be found in the community and economic development sector (7.8 percent), followed by public safety (7.3 percent).[24] It is noteworthy, however, that Native Alaskans, who make up nearly 19 percent of the state's population, are still underrepresented in every office of state government. No other minority group is as largely underrepresented.[25]

As table 4 indicates, minorities make up a larger percentage of part-time employees, at 25.8 percent, than they do full-time employees in both permanent and temporary positions. In every category (full-time, part-time, and seasonal), minorities make up a larger percentage of nonpermanent employees than permanent. In fact, 40 percent of all nonpermanent employees are minorities.[26] Minorities are also three times more likely to be nonpermanent seasonal employees than permanent. Alaska Natives account for 37 percent of nonpermanent seasonal workers. Thus, not only are minorities more likely to be employed in part-time and seasonal positions, but they are also more likely to hold temporary positions when employed by the state. These numbers indicate a clear trend with a real economic impact in terms of income and benefits. Based on the numbers alone, it is impossible to determine why this employment trend exists, such as whether it is due to the seasonal nature of rural jobs, participation in subsistence activities, or the result of discrimination. Nonetheless, it is clear that the state must evaluate the economic impact of seasonal and nonpermanent work on the Native population, and take action to correct any disparities that are found.

Furthermore, despite that a large percentage of Alaska Natives reside in rural communities, the representation of minority employees in rural offices of the state executive work force is not much better than in urban areas. Whereas in urban centers minorities make up roughly 18.0 percent (3.9 percent Alaska Native) of the state executive work force, in rural areas they account for 18.2 percent (8.2 percent Alaska Native much less than their percentage of the population).[27] When adding in nonpermanent employees, the percentages of minorities increase to 23.8 percent in rural Alaska and 21.8 percent in urban areas.

The municipality of Anchorage does not fare much better than the state in terms of employing minorities in percentages comparable to their representation in the population. Overall, only 14 percent of the city's work force (which includes approximately 2,600 people) are minorities.[28] Yet, minorities make up nearly 23 percent of the city's population. The mayor of Anchorage stated that he has made attempts to diversify the city's work force and noted that approximately 30 percent of his executive appointments have been minorities, and half are women.[29] He acknowledged, however, that these numbers do not percolate all the way down through the ranks. [30] The reality, he said, is it does take a gradual, more concerted effort to make significant changes in the career municipal employees than it does in the executive ranks. [31] The mayor stated that if more minorities are going to be recruited, it is necessary to set aside old networks and actively search for candidates. In addition, once the management level is diversified, it will better reach minority communities.[32]

These numbers only provide a glimpse of the employment situation. To really understand the work force disparities and the extent to which employment opportunities exist, one must examine levels of employment in terms of job classifications and promotion rates, which are directly related to income. However, data are currently not collected on the promotion of employees by race/ethnicity, so it is impossible to determine whether minorities are being promoted at the same rates as nonminorities.

ASSESSING THE EMPLOYMENT DIVIDE

While the statistics provided thus far only present insight into one sector of employment, within one industry, they reveal much about the employment condition of many Alaska minorities, Natives in particular. And unfortunately, this occurrence is not isolated. The same underrepresentation is evident in private sector employment. According to one Alaskan economist:

The share of Alaska Natives employed in virtually every industry in the state is less than their share of the population. . . . [A] 50 percent increase in Native workers would be necessary to create parity in job holdings. In some occupations requiring higher education, a 200 percent increase would be necessary for parity.[33]

As was discussed above, rural communities face many unique economic challenges, most noteworthy of which is the lack of jobs. Obtaining a job in rural areas is difficult for a number of reasons, the most prevalent being the lack of economic development and hence the lack of opportunity. This is compounded by the fact that often developers and other employers, when initiating jobs in rural communities, bring their own labor, in effect squeezing out the local labor force, which is primarily Native. According to one panelist who spoke before the SAC, hundreds of construction jobs are initiated each year in villages, but often contractors are required to pay union wages. Those contractors import labor from urban unions, leaving village residents out of work.[34]

The state commissioner of administration stated that many attempts have been made to put in place a local-hire law with no success. He added, however, that it is his impression that the unions in the state try to include local labor in their projects. They can do so through project labor agreements that require a certain level of local employment.[35] However, he also acknowledges that the problem has not been solved to the satisfaction of rural Alaskans.

It is also important to examine general hiring and recruitment practices that may place certain segments of society at a disadvantage. For example, nearly all state of Alaska jobs require at a minimum a high school education or GED, an Alaska driver's license, and prior work experience with the state. These qualifications, as benign as they may seem, effectively render many Alaska Natives ineligible, particularly those from rural communities.[36] In addition, residents in rural communities often have difficulty even learning about job opportunities because often job listings and hiring opportunities are communicated through Internet technology to which many small villages do not have access.

Once minority employees obtain jobs, they are often faced with additional challenges, including discriminatory policies and practices, and intolerance by co-workers. Many examples were presented during the SAC forums.[37] The director of Alaska's Human Rights Commission recounted several recent employment discrimination cases:

• In one, the employee, a Mexican American warehouse worker alleged that his supervisors and co-workers nicknamed him Poncho and referred to him in written notes and conversations in derogatory ethnic terms. He complained and was subsequently subjected to differential treatment and fired. His case was successfully conciliated.[38]

• In another case, an Alaska Native mine worker was subjected to racial harassment and was forced to resign his position due to the continued harassment. This case resulted in a settlement favorable to the employee, which included back pay. [39]

• Another complaint, under investigation at the time of the SAC forum, was that of an Iranian Muslim who worked as an aircraft mechanic. He complained that his co-workers spat on the windshield of his work vehicle, cut the lock off his locker, placed quarantine stickers on his locker, put a hangman's noose in his mailbox, and wrote derogatory comments about him, including fabricated disciplinary counseling forms.[40]

• In another instance, a company imported skilled workers into a rural community for a building project and also hired local workers. The company then put a policy in place that only allowed overtime for the imported workers. This policy obviously had a negative impact on all the local workers, most of whom were Alaska Native. Relief was obtained for the workers harmed by this policy.[41]

These are not isolated instances. In 2000, 347 complaints were filed with the Alaska State Human Rights Commission. The vast majority of those complaints were in the area of employment. Although this number has decreased from 664 in 1995, according to the agency's director this is not necessarily due to a reduction in discrimination, but rather to the availability of jobs. Individuals often would rather look for a new job than go through the lengthy complaint process.[42] Racial discrimination is the most common reason individuals seek assistance from the Human Rights Commission, followed by discrimination on the basis of sex, disability, and age. In a seven-year review period, the number of race or national origin harassment complaints filed with the Human Rights Commission rose by 52 percent. The director of the agency stated:

I think that in Alaska, many businesses are making an effort to create a productive and discrimination-free environment, but there are also plenty of cases where supervisors and managers continue to tolerate troubling behavior. That's back-stepping in Alaska, as well as elsewhere.[43]

Likewise, the Anchorage Equal Rights Commission investigates discrimination in the areas of employment, housing, educational institutions, public accommodations, financial institutions, and programs and services provided by the city.[44] The majority of the agency's cases 428 of the 636 filed over the past five years involve employment discrimination issues. Interestingly, only 12 of those cases involve discrimination against Alaska Natives.[45] Testimony during the forums pointed to the conclusion that Native Alaskans are not less likely than other groups to be discriminated against; however, they are less likely to file a complaint because they distrust the system.

ACHIEVING EQUITY IN EMPLOYMENT

The economic challenges faced by Alaskans are many, but there have also been significant inroads made toward reducing some of them. According to the commissioner of the Alaska Department of Administration, the state is making attempts to diversify its work force and practice inclusion, as can be seen in recent hiring practices. The state has also recently instituted an employment discrimination and harassment course as a component of basic supervisory training.

It is also noteworthy that the state of Alaska has an affirmative action policy statement in place for its executive branch of government, with established goals to promote diversity in the work force, 're medy any racial, ethnic, or gender imbalances, and bring the state employment profile more closely in line with the available workforce. [46] A representation and availability study is conducted on a quarterly basis by the Office of Equal Employment Opportunity within the governor's office. The Department of Administration records the information in the state's electronic recruitment system, putting hiring officials on notice. This does not necessarily mean that a minority will be hired to fill the position, but rather that qualified minority candidates will be given careful consideration.

In addition, the state is beginning to employ other strategies designed to reach minority populations in the state, such as participating in job fairs to reach people who do not have access to electronic job listings, advertising vacancies more prominently in the three major Alaska newspapers, notifying Alaska corporations of vacancies, and conducting applicant training sessions in partnership with job service offices statewide.[47]

In March 2002, as a result of the recommendations made by the Governor's Commission on Tolerance, Governor Knowles issued an administrative order, which, among other provisions, requires diversity training for all state personnel and specific cultural competency training for supervisors. The order also establishes a complaint process for citizens to report discrimination by state employees, and protects state employees against employment discrimination on the basis of sexual orientation or economic status.[48]

Finally, in the hopes of better serving state employees, the State Department of Administration is conducting a confidential survey of the job satisfaction level of all state employees. The hope is that this will reveal whether there is discrimination in state government and whether supervisors are unresponsive to employees needs.[49]

Individuals employed in the private sector will not benefit directly from these state initiatives, although at least one step has been taken to improve the economic conditions of employees statewide. An initiative that would increase Alaska's minimum wage to $7.15 an hour, a $1.50 increase, was recently cleared for statewide ballot. Several bills are also pending before the state legislature that would increase the state s minimum wage to varying degrees.[50]

Much work remains to equalize the opportunities, as well as economic and working conditions of all Alaskans. A consensus among SAC panelists was that change must be initiated from the top down from political leadership, to employers, to employees. The state must approach employment equity from a big picture view, developing initiatives to encourage labor force participation and to create opportunities where there are none. Further, state and local agencies charged with enforcing nondiscrimination in employment must be given the tools needed to carry out their responsibilities and to address employment discrimination on an individual level. Yet, this does not appear to be a priority for lawmakers. For example, despite the importance of the Equal Rights Commission's work, the agency has received little support from local political leadership. Its budget and staff have been cut from $475,000 and nine employees in 1987 to $454,000 and six employees in 2001. In fiscal 2000 there was a proposal to cut the agency by 80 percent, which would have effectively eliminated local control of civil rights enforcement in Anchorage. [51]

With actions like this, it is no wonder that Alaskans have lost faith in the systems supposedly at work for them. According to the Governor s Commission on Tolerance final report:

There is a perception among Alaska's minorities and others that the State of Alaska does not respond adequately to complaints of harassment and mistreatment in the workplace. As an employer and a service provider, the state must work to abolish institutional intolerance.[52]

Ultimately, minorities in Alaska must have access to the tools needed to succeed in the workplace. The absence of Native Alaskans, in particular, indicates that there has been a failure on the part of the state to prepare them for participation in an economy that is largely foreign to them and to include them in the decision-making processes. According to one economist, achieving full employment for rural and urban Native Alaskans requires that a larger share of existing jobs be taken by Alaska Natives, that efforts are made to expand jobs in rural Alaska, and that Native Alaskans receive education to prepare them for jobs in a market economy.[53]