ECONO MICS
Ten years ago, southern Utah and the rest of the nation were suffering the devastating effects of the Great Recession. Since then, southern Utah has recovered and has found itself in full expansionary mode (with only a little scarring to its economic psyche). In fact, the United States’ expansion now ranks as the second longest in history. With the recovery becoming somewhat stale, the time seems ripe to check in with the economy. The year-to-year change in nonfarm employment provides the best indicator of the business cycle. Here, Washington County excels. Currently, job-growth rates are trending near 5 percent, while neighbors Iron County (4 percent) and Kane County (2 percent) show slower but still strong to moderate expansion. This 5 percent employment expansion would suggest overheating in most areas, but given Washington County’s strong in-migration, 5 percent falls in the “goldilocks” zone (not too hot, not too cold). If you are tempted to think that 5 percent expansion might be too hot for Washington County, just remember 13 years back when job growth measured 10 percent. That is overheated.
Importantly, the job gains are broadbased, with most major industries sharing in the employment joy. Recently, construction, healthcare, manufacturing,
and leisure/hospitality services have added the highest number of new jobs. While a few irregular layoffs have occurred, firsttime claims for unemployment insurance remain low and are generally seasonal in nature.
construction. In Washington County, the number of 2017 home building permits approved registered about 800 units short of the peak bubble year. Moreover, sorely-needed multi-household units comprised about 30 percent of total 2017 permitted dwelling units. In other words, homebuilding has yet to approach the excesses of the mid-2000s. Healthy homebuilding is also occurring in Kane and Iron counties.
Robust job growth in the state’s southwest corner has driven unemployment down into the full employment range, reflecting a tight labor market. Iron, Kane, and Washington counties all show jobless rates of 3.5 percent or The staggering and less. A dearth of available swift rise in home workers has recently prices that occurred Southern Utah’s put upward pressure in the bubble years economy is currently on hiring wages. contrasts with the running on all cylinders. current steady Gross taxable However, the long length of the but moderate sales remain present-day expansion coupled home price strong in all with uncertainty on the national and increases. southern Utah international scenes recommends However, while counties. In fact, keeping an eye on the area’s there is little sales have been economic indicators at: evidence of a the most robust housing bubble, and consistent of all jobs.utah.gov/wi the construction the area’s economic industr y appears indicators. Typically, headed toward the annual gains during the peak of a cycle that will recovery have hovered around the eventually turn. In contrast with 10 percent mark. residential building, the last two years of Not surprisingly, given the housing nonresidential permit values far out rank bubble of the late 2000s, inquiring minds any other year in Washington County’s may wonder about the current state of history.
Southern Utah: BACK IN THE ECONOMIC HIGH LIFE AGAIN
BY LECIA PARKS LANGSTON SENIOR ECONOMIST, UTAH DEPARTMENT OF WORKFORCE SERVICES Lecia Langston is currently a regional economist for the Department of Workforce Services. She is also responsible for making occupational projections for all of Utah. Ms. Langston has been an economist with the Utah Department of Workforce Services for more than 30 years. During six of those years, she served as chief economist for the department before moving to the St. George area. Ms. Langston has served as a past president and officer of the Wasatch Front Economic Forum (the local chapter of the National Association of Business Economists). She is a past advisor of the Governor’s Economic Coordinating Committee. Ms. Langston is the author of several studies including “Hard at Work; Women in the Utah Labor Force” and “At your Service: Utah’s Service Economy.” She is the workforce services expert in women’s labor force statistics. Lecia is a native Utahn, born in Richfield. She graduated from Utah State University with a bachelor’s degree in economics and political science.
40 Southern Utah Business Magazine
Fall 2018