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When Alaska gained statehood in 1959, its economy was almost totally dependent on the US government. Fisheries, limited mining (mostly gold and gravel), and some lumber production made up the balance. That all changed with development of the petroleum industry during the 1970s. Construction of the Trans–Alaska Pipeline brought a massive infusion of money and people into the state. Construction, trade, and services boomed—only to decline when the pipeline was completed.

In the mid-1980s, the economy was dependent on government spending, especially by the state, and on the oil industry, which by 1984 supplied 85% of state revenues. The collapse of the oil prices in the mid-1980s hit Alaska hard. Employment dropped 9.4% between 1986 and 1988. By 1990, a recovery was underway. Accumulated gains in employment, while small, more than compensated for the losses of a few years before.

One area of growth in the 1980s and early 1990s was the Alaska groundfish industry. Commercial fishing is one of the bulwarks of the Alaska economy. The seafood industry had wholesale values of more than $3 billion in 1990, and Alaska's fishery accounts for 50% of the total annual US catch. The volume of Alaska groundfish catches rose from 69 million lb (31.3 million kg) in 1980 to 4.8 billion lb (2.2 billion kg) in 1990. Employment in seafood harvesting grew from 45,000 in 1980 to 54,000 in 1991, although the boom has slowed somewhat since.

Retrenchment of oil and gas companies reduced mining jobs by 11% in 1992. Log exports began to decline in 1990 and were expected to drop 50% by 1997 as the supply of timber shrank. In 1993, the state sued the federal government for violating the Statehood Act. The act had entitled Alaska to 90% of the revenues from mineral leasing on federal lands. Since passage of the Act, however, half of the federal lands had been withdrawn from mineral leasing. Job creation rates, which ranged from 2% to 4% in the early 1990s, rose and fell from nearly 3% to less than 1% for the rest of the decade roughly in line with the rise and fall in North Slope oil prices, which hit troughs in 1994 and 1999 (during which the oil price hit a low of $12.73 a barrel). Gross state product fell 7.2% in 1998, but then increased 3.6% in 1998 and then soared 10.1% in 2000. In 2000, Alaska oil revenues still accounted for almost 85% of total state revenues, although low oil prices and production during the late 1990s threatened to lower this percentage. The tourism industry attracted over 1.1 million visitors in 2000, and contrary to national trends, continued to expand into 2002. The number of inbound cruise ship visitors, for example, increased 14% from summer 2001 to summer 2002. Other important industries include timber, mining (including gold, coal, silver, and zinc), and agriculture. The national recession of 2001 reduced gross state product growth to 1.6% and slowed employment growth to less than 1% in early 2002, again in line with sharply falling oil prices. Loan delinquency increased, with the median past-due loan ratio rising from 1.52 % to 1.62% from September 2001 to September 2002. From 1997 to 2002 increased environmental regulations and foreign competition from, particularly, Chile and Norway, contributed to a decline in employment in the traditional seafood packing industry of more than 15%. On the other hand, employment in both state and local government, and in the hotels and lodging industry increased by almost 15%. Employment in the oil and gas extraction sector increased by about 5% 1997 to 2002, while employment with the federal government decreased almost 3%. In 2003, rising oil prices, reflecting political instability in Iraq and Venezuela and other factors, were expected to benefit the Alaskan economy

In 2001, Alaska's gross state product was $28.6 billion, with 19.5% accounted for by the public sector, the 2nd-highest percent among the states (after Hawaii), and well above the state average of 12%. Both mining and government contributed about $5.6 billion to gross state product in 2001, but for mining this represented a 19% decrease from 1997 and for government a 10.8% increase over the same period. Public utilities and transportation contributed $4.6 billion, up 15% from 1997. Both general services, contributing $3.96 billion, and the finance, insurance and real estate sector, contributing $3.2 billion, increased about 29% 1997 to 2001. Other important sectors included retail trade, at $1.9 billion (up 12% from 1997) and construction, at $1.4 billion (up 24% from 1997). The manufacturing sector contributed $1.06 billion, down 5% from 1997.