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With Utah’s unemployment rate holding steady at 5.8 percent, it appears the state’s economy has hit a growth ceiling, according to the latest report from the Utah Department of Workforce Services.
The state’s economy added 27,400 jobs in the past 12 months, for a growth rate of 2.3 percent. In fact, the growth rate has stayed within the 2 percent range for the past four months—far below Utah’s long-term average yearly growth rate of 3.1 percent.
However, Lecia Parks Langston, regional economist with the DWS, cautions not to read too much into what could be a temporary situation. “The economy never does run in a straight line,” she says. “Just because it has slowed for a minute doesn’t mean it’s going down.”
According to the DWS analysis, several factors are preventing a full economic recovery in Utah. The high gas prices, for example, are putting a drag on the economy. High gas prices impact everything from production to the transportation of goods—not to mention the amount of money consumers have to spend, says Langston. “We’re not going to produce as much or buy as much.”
Another dampening factor is the housing market, which has yet to rebound. According to the DWS report, there are few signs the housing market will begin to recover this year.
Overall, the growth rate for jobs in Utah is good news, says Langston. “The expansion is fairly broad based—it’s not just a one-industry wonder.”
The natural resources sector is particularly strong due to increased natural gas extraction in the state. Construction and manufacturing each experienced job growth of 4.7 percent. That is particularly notable for the construction industry, which has yet to see expansion in residential construction.
Professional and business services experienced the most job growth overall, while leisure and hospitality was the only sector to shed jobs over the past 12 months.