Alaska tourism industry sees reasons for optimism in 2022 after a roller-coaster year

A topsy-turvy visitor season for Alaska ended with plenty of optimism for 2022, according to industry leaders across the state.

“Things continued to change. Even though I don’t think our industry was in as much of a crisis mode as it was in 2020, I would say 2021, through the summer season, was really a mixed bag,” Alaska Travel Industry Association CEO Sarah Leonard said. “Overall, we’re super grateful that we had the economic activity that we did for 2021.”

This year’s peak visitor season started with a major hurdle: the prospect of no large cruise ships and the thousands of visitors each can bring for a second consecutive year.

Canadian transportation officials in February announced a continuation of their 2020 ban on large cruise ships in the country’s ports, meaning no foreign-flagged or built cruise vessels could sail to Alaska from West Coast cities without violating federal maritime law.

The 19th century-era Passenger Vessel Services Act requires foreign passenger vessels sailing between U.S. ports to make at least one stop in a foreign port — then an attempt to buoy the nation’s shipbuilding and maritime industries.

The first large, Alaska-bound ships since 2019 sailed in late July and, according to estimates by local economic researchers, brought just more than 100,000 passengers, or about 10% of recent years.

Additionally, no large ships made the cross-Gulf voyage to Southcentral ports during the shortened season. Cruise ships cumulatively brought several hundred thousand visitors to Seward, Whittier and Anchorage each summer prior to the pandemic.

Robert Venables, executive director of the Southeast Conference, a regional development organization, said the disappointment to start the year in the industry was ultimately turned around by the end of the summer, in part due to the cruise activity, but also because of a boom in independent travel. Based on anecdotal reports, it was enough for many visitor-dependent businesses struggling through a second pandemic summer to keep their doors open, according to Venables.

“Businesses that might have had to fold or take more drastic measures this winter maybe are able to hold on until next spring,” he said, when expectations are “much more robust.”

To the north, Explore Fairbanks CEO Scott McCrea said Interior visitor businesses did “surprisingly well this summer given all of the factors to include.”

The lack of cruise ships to Southcentral ports meant far fewer Fairbanks-bound tourists via coach bus or Alaska Railroad tours, which typically provide about 40% of the region’s summer visitation, according to McCrea. Cross-border highway traffic and other international travel was similarly depressed by COVID-19 restrictions, he noted.

“We definitely saw, like the rest of Alaska, an extraordinary surge in domestic, independent travelers,” McCrea said.

He attributed a surge in last-minute Alaska trips to very buyer-friendly airfares most of the year.

“Normally we’re a destination people plan months in advance,” he said. “Our visitor information staff spent a lot more time than they usually do working one-on-one with visitors because they were showing up with no plans at all.”

The unexpected activity left some visitor-centric businesses short-staffed, just a year after Alaska’s overall leisure and hospitality lost nearly 30% of its jobs, according to state Labor Department data.

Airlines added capacity back to Fairbanks and Alaska in general faster than expected. McCrea noted that Fairbanks International Airport saw record capacity at the start of the summer. In Anchorage, passenger capacity rebounded to 83% of 2019 levels by mid-year, according to Ted Stevens Anchorage International Airport officials.

McCrea said he expects continued improvement next year as more cruise ships return and border travel likely becomes easier. More immediately, Fairbanks’ aurora-viewing season is off to a good start as well, he said.

“It’s sounding like February and March are going to be pretty strong for us,” McCrea said.

Venables added that Southeast’s many fishing lodges and outfitters also reported strong business over the summer — much of it rolled over from 2020.

He has robust expectations for next year. Venables said he would consider a “three-quarter season” next summer a success; meaning about 75% of the cruise traffic compared to pre-pandemic averages of slightly more than 1 million cruise passengers.

ATIA’s Leonard emphasized that encouraging more travel to Alaska is a fundamental way to help the state’s broader economic recovery. Prior to the pandemic, tourism defied Alaska’s general economic struggles in recent years and was one of the state’s fastest-growing industries.

“I’m hopeful people will continue to feel comfortable traveling and we’re seeing that sentiment really hasn’t changed throughout the U.S. and Alaska” Leonard said.

By:  Elwood Brehmer
Source: Alaska Journal of Commerce