Overview of the Calista Regional Economy
1741 generally marks the beginnings of contact between western society and the indigenous peoples of Alaska. This is the year Vitus Bering and his second-in-command, Aleksi Chirikov sailed in two ships from Kamchatka for North America. Over the next one hundred years the Russians learned a great deal about the geography of Alaska. There were over sixty Russian voyages by what was called Russian America before its sale to the United States in 1867. The whole area was mapped by the explorers including the Bering Sea coast and some of the Arctic. In the 1840s to 1863 Russian Missionary Jacob Netsvetov recorded regional fur and fishing trading activities by the peoples of the region to supply trade in exchange for trade goods and new items such as knives, guns, tools and other implements useful for increasing efficiency of subsistence hunting and fishing. Trading posts and forts were established in certain locations in the region and provided permanent settlements for many of the indigenous people. In the 1870s and 1890s Moravian and Catholic missionaries recorded increasing numbers of parishioners settling in permanent communities. The gold rush of this period saw miners in small numbers prospecting throughout the region in search of gold.
The first real economic development in the Calista region began with the onset of mining operations in the early 1900s. A mercury mine was established at Sleetmute on the Kuskokwim River in 1906. In 1907, gold was found in several locations and hundreds of prospectors poured into the region, forming several major settlements. By the 1920s, the mining boom and gold rush was over. After that, there was only limited trading and mining activities in the region. For the most part, the income generated from the mining boom and gold rush was taken out of the region. Only the trading and mining companies and temporary non-Native residents of the area made any money. With the demise of the mining operations in the Calista region, the area's economy entered a general decline.
After World War II, federal expenditures for airports, communications facilities, and social services became increasingly important, but did not replace the economic activity generated by mining in the region. The federal government's role in the region's economy was supplemented by the State of Alaska after statehood. As Alaska's economy grew, state expenditures became increasingly important to the region's economy, particularly in the 1970s. Unfortunately, most of the new jobs created by state and federal expenditures were filled by persons from outside the region because few people in the region had the requisite skills needed to fill the jobs.
In the private sector, commercial fishing, construction, trapping, and crafts production provided village residents with employment and earnings during the 1960s and 70s. Unemployment remained high and subsistence activities continued to be a primary element of the regional economy, particularly in the smaller villages. The Calista region has never experienced economic booms like other areas of the state. For example, the Calista region and its residents were left out of the big Trans-Alaska pipeline construction boom. The region was too far away to provide services and village residents had neither the skills nor the trade union membership necessary to get the jobs available during construction of the pipeline. As local economies in other areas of the state grew throughout the 1970s and 1980s, the Calista region's economy, with the exception of construction, actually declined and local residents became even more dependent on state and federal monies for survival.
Over the last 100 years, the economy of the Calista region has evolved from a total subsistence economy to a mixed subsistence/cash economy. Subsistence remains very important to the overall economy of the area. Although wage employment has become more prevalent, it has not developed enough to support village residents. The Calista region shares a common characteristic with most rural Alaska regions: they have mixed economies based on the subsistence use of renewable resources and cash provided by the government in the form of wages, transfer payments, revenue sharing and investments in infrastructure and the role of the private sector is limited (House Research Agency, 1982). For the immediate future, a mixed economy, which combines the activities of wage employment and the harvest of subsistence resources for both commercial and subsistence use, is expected to continue, simply because neither subsistence nor wage employment alone can support village residents (Fienup-Riordan, 1983).
Government spending is the single most important component of the regional economy, as is the case in much of rural Alaska. The stability of the Calista region's economy is largely dependent upon outside public funding; consequently, the economy is very vulnerable to state or federal budgetary and program adjustments.
The overall contribution of government spending to the economy is much greater when government expenditures for construction, shared revenues, grants, and other items are included. In 1990, it is estimated that state and federal expenditures accounted for approximately 65 percent of the total wages earned by residents of the Calista region. The role of government in the region's economy is very visible in activities and services provided by the AVCP Regional Housing Authority, the Yukon-Kuskokwim Health Corporation, the Public Health Service Hospital in Bethel, Kuskokwim Community College, the REAA's, and the Alaska Department of Health & Social Services.
Commercial fishing provides the largest influx of non-government money and wages into the region's economy. Commercial fishing activities have helped diversify an economy which is otherwise totally dependent on government spending. Most of the manufacturing employment in the region is in fish processing, which provides an important source of seasonal earnings to village residents, particularly for unskilled workers. Although the total earnings from commercial fishing are still relatively low compared to total income in the region, they provide an important source of income in many of the smaller villages where employment opportunities are limited. High costs for fuel and gear limit the economic return to the region's commercial fishermen. The average earnings per fisherman are usually insufficient to meet annual income requirements for a family in the region, and must therefore be supplemented by other income sources or subsistence foods.
Additional sources of earnings in the region are hunting and trapping, and crafts production. Like fishing, these occupations are not major income producers at the regional level, but provide some cash earnings to individuals. These occupations are important since they provide earnings during the winter months when construction, fishing, and other seasonal work are unavailable. The production of crafts such as baskets, ivory carvings, and other art forms is practiced in villages throughout the region, but the lack of well-established markets limits consistent earnings from these activities.
The growth of government, trade and services sectors has resulted in white collar/professional jobs in the region. However, most men living in the villages are trained as blue collar workers and laborers so the region has a disproportionately high amount of blue collar labor available for the few labor related jobs available. As a result, new white collar jobs are often filled by outsiders coming into the region with the necessary skills.
The major center of regional economic growth continues to be the city of Bethel. While small and relatively undeveloped by urban standards, Bethel has a much more active and prosperous local economy than the outlying villages of the Calista region.
Average wages are substantially higher in Bethel than in the surrounding villages, reflecting the greater proportion of professional and technical jobs which are available. As a result, per capita incomes are much higher in Bethel than in the outlying villages. The average per capita income for the Calista region is distorted when Bethel is included; consequently, the true economic -situation for the 80 percent of the region's village residents is really much lower than what the statistics show.
The largest employer in the Calista region is local government, which provides 17 percent of the salaried jobs. Local, state, and federal government agencies combined provide approximately 60 percent of the jobs in the region. Education, health and social services, and administration are the main areas of public employment.
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