The Center has done its survey each fall, but the economy changed so dramatically this spring, the staff thought the data from autumn might be irrelevant.
“The situation at the end of 2024 was markedly different,” said Jon Bittner, State Director of the Alaska Small Business Development Center.
He says last fall, the Center surveyed 960 small businesses across 92 Alaska communities, covering 75% of Alaska’s industries, and businesses then were optimistic.
“Businesses were looking forward to growth, looking forward to expansion, and we looked at the results. And now in 2025, just isn't the same,” Bittner said.
So, in April, they put together another survey, called a Quick Pulse survey, to update the data. They got responses from a re-engaged group of 273 businesses, close to a third of the fall survey, and those findings revealed a sharp reversal in small business confidence in the first months of 2025.
“Generally speaking, it was a lot of fear, uncertainty, and doubt,” Bittner said.
“Generally speaking, it was a lot of fear, uncertainty, and doubt.”Jon Bittner, State Director of the Alaska Small Business Development Center
For the first time in the survey's history, political uncertainty emerged as one of the top-three challenges facing Alaska businesses, joining inflation and rising operating costs at the forefront of concerns. Bittner says workforce problems and operating costs have always been named as either number 1 or 2 barriers, but even during the COVID pandemic, political factors didn’t rise in the list.
“We survey Alaska small businesses and ask them specifically, ‘what are the top three barriers to your business?’ And for the last eight years, it's been workforce, operating costs, the third one that's a wild card, but never political uncertainty; that's never made it to the top 10 before,” Bittner said.
Bittner said Center staffers started hearing of a turnaround from Alaska small businesses in February, after federal layoffs and agency closures. But it was the implementation of tariffs in the international market in April that caused optimism to plummet.
“This was something that hit their books almost immediately,” Bittner said.
The feedback on the Pulse survey gave him insight as to why.
“There was a lot of uncertainty. People were upset. They didn't feel like they had enough time to prepare," Bittner said.
"There were a few that were still broadly supportive. They said, 'this is going to impact our business negatively,' but they believed in the vision. Not many, but there was a handful.”
Bittner says Alaska business owners are generally quite resilient, but they already face challenges that aren’t in other places. So federal cutbacks and tariff uncertainty are hitting harder here.
“We're the only state that truck traffic has to travel through a foreign country to get to us. We rely heavily on industries like commercial fishing that are particularly susceptible to tariffs. We already had a high cost of doing business and high cost of operations, so adding more to that, particularly in rural communities, is extremely disruptive,” he said.
“And a lot of programs rely on federal funding. There's broadband, there's healthcare, there's tribal funding. It's integrated into a lot of aspects of Alaska.”
The full report includes charts and visuals that highlight the rapid four-month shift in Alaska’s small business climate. It’s available now on the Alaska Small Business Development Center’s website. https://aksbdc.org/about/annual-reports/
