TL/DR –
Alaska’s major cities, Juneau, Anchorage, and Fairbanks, rank among the top 25 in the U.S. for high cost of living, driven by high healthcare and grocery costs, according to a report by the Alaska Department of Labor and Workforce Development. Juneau had the highest overall cost of living in 2025, at 31.7% above the national urban average, while Anchorage and Fairbanks were 25.5% and 22.9% above the average respectively. However, despite high costs in other aspects, housing in Fairbanks was 1% lower than the national urban average, but this was offset by utility costs that were 113% higher than the average.
High Living Costs Continue in Alaska’s Major Cities, Latest Analysis Reveals
Recent data from the Alaska Department of Labor and Workforce Development shows that Alaska’s three major cities, Juneau, Anchorage, and Fairbanks, continue to rank among the top 25 most expensive urban areas in the U.S. to live. Despite high living costs, the cities remain significantly cheaper than places like Manhattan or Honolulu.
The driving factors behind the high living costs in these Alaskan cities are primarily healthcare and groceries. In 2025, Juneau, Anchorage, and Fairbanks had some of the nation’s highest healthcare costs, with Anchorage having the third highest in the nation. Grocery costs in the three cities were also significantly higher than the national urban average.
Furthermore, while Fairbanks had lower housing costs in 2025 than the national average, the high utility costs more than offset the savings. The city had the highest utility costs among all metropolitan areas in the study.
Alaska’s inflation rate in 2025 was a modest 2.1%, below the state’s average of 3.3%, and lower than the national rate of 2.6%. This trend is likely due to the lingering impact of the COVID-19 pandemic.
However, the U.S. invasion of Iran, which started at the end of February, has caused energy costs to surge, and is expected to push the 2026 inflation rate higher, both nationally and in Alaska.
Despite being a major oil producer, Alaska has higher energy prices than the rest of the nation. Gasoline prices in urban Alaska averaged $3.66 a gallon in January, compared to the national average of $3.10. In rural Alaska, six villages posted average January gasoline prices above $10 a gallon.
—
Read More Health & Wellness News ; US News