Boom Town: Utah Valley prepares for another growth spurt

Lehi Mayor Bert Wilson remembers the time when his city was a small, sleepy town with only a single McDonalds inside its borders. “I thought we had made it,” he laughs. Little did he—or likely anyone else—know what Lehi would one day become.

Today, the once small, sleepy town is a bustling tech community with the likes of Adobe, Microsoft and IM Flash calling it home. But more than a tech haven, Lehi now includes nearly 30 restaurants, an outlets mall, several hotels and Thanksgiving Point. “We’ve become a popular place to do business,” Wilson says.

Lehi isn’t the only city booming in Utah Valley—the entire area is bursting with growth, most of which is driven by the tech industry. Cory Stahle, regional economist for the Department of Workforce Services (DWS), says the area’s growth rivals just about anywhere else in the country. According to Stahle, Utah County’s job growth ranked first among large counties in the United States during Q1 and Q2 2015. And in the three following quarters, Utah County’s growth was second only to Williamson County, Tennessee.

“In addition to robust job growth, the unemployment rate in Utah County reached an eight-and-a-half year low of 2.9 percent in August 2016,” says Stahle, adding, “Economic growth, while desirable, sparks a unique set of challenges.”

Success breeds success

Utah Valley’s tech success story started decades ago when companies like WordPerfect and Novell opened up shop in the area, and was reaffirmed with later success stories like Omniture and IM Flash bolstering the tech industry further. Today, Utah Valley has proven again to be a healthy home for tech companies ranging from large corporations, like Ancestry, Qualtrics and Domo, to promising tech startups.

The area’s tech success has had a great impact on the local economy and community, says Stahle. He sees the industry shaping Utah Valley in two major ways. First, the industry has helped attract and develop a highly skilled workforce. “Among its many benefits, having a pocket of workers with specialized technology skills makes hiring easier and reduces business training costs. This encourages new and existing businesses to locate or expand in the area, providing new jobs,” he says.

“Second, many of these companies provide high-paying jobs, which benefit their employees and the economy as a whole. … When those paychecks are spent at a local retail store, it ripples through the economy by allowing that store to use its new income to hire, invest and grow their business. New store employees then spend their money and the process continues, providing additional economic growth.”

While tech is leading the surge, it’s only part of the area’s economic story. Other industries are now flourishing in the area, too. “There are several more office buildings that will be going up in next few months, and more hotels going in. Permits are being worked on as we speak,” says Wilson. “More businesses keep coming and then people start coming to Utah County. … For the first time in many, many years, we have people who grew up in Lehi and Utah County coming back because they now have jobs available for them. It all breeds off of each other.”

Workforce woes

It’s clear that Utah County’s tech success has put the area on a major growth trajectory, but it’s not all good news. “Growth comes with its own set of challenges,” says Wilson.

Talk to just about any tech leader in Utah Valley, and they’ll tell you that finding employees with high-tech skills is challenging. “Because the unemployment rate is very low, jobs are very competitive in certain sectors, specifically in technology,” says Dixon Holmes, Provo deputy mayor. “That presents some challenges. Some of the companies cannot find what they’re looking for.”

“We could use several hundred, maybe a couple thousand employees in Lehi to work in the high-tech industry,” adds Wilson. “[Tech companies] are having to take from each other just to keep their businesses going.”

Patrick Donegan, DWS workforce development specialist, says employers must be creative to attract the kind of talent they need. “Competition for workers leads employers to take a more hands-on approach to recruiting, including increased collaboration with education, innovative marketing strategies and elevated interaction with candidates,” he says. “Employers can no longer just list an opening on the website and expect job seekers to come and apply for the job. Employers are having do a lot more work.” Work like attending job fairs, sending out targeted recruitment emails, increasing their benefits and wages, and improving workplace culture.

Beyond internal changes, several companies are partnering with local colleges and universities to develop specialized programs to find the employees they need. One example is the software testing certificate program at Utah Valley University. “The program was developed through a partnership with local companies and many of the graduates of the program are hired by those companies,” says Donegan. “Mountainland Applied Technology College and Intermountain Healthcare also partnered to create a surgical technology program in which Intermountain Healthcare is able to enroll their employees for the training; and, in turn, provide externship opportunities and possible placement for a majority of the students in the program.”

Beyond traditional educational programs, coding bootcamps, like DevMountain and Vschool, have opened up shop in the area and are easing the tech skills gap, says Holmes. But Holmes says Utah Valley needs more than just tech talent. “We also need trade workers. Oftentimes it’s hard to convince young people to go swing a hammer or install sheet rock,” he says. “Those are trades and skills that are necessary. If there aren’t people to do that kind of work, costs go up.”

Creating a diversified workforce and economy is a challenge that Holmes says Utah Valley must tackle to stay competitive for years to come. “There was a time when Utah Valley was dependent on Geneva Steel. When it closed, it put a pinch on our economy. As important as tech is, manufacturing, education, the medical field—those are all things that we need to make sure we have the resources, education and opportunities for people to participate in.”

Growing pains

Beyond finding enough skilled employees to keep businesses growing, Utah Valley cities are also facing infrastructure challenges posed by the area’s phenomenal growth. And with a population expected to double, infrastructure needs are expected to become more challenging. Wilson and Holmes say their cities (Lehi and Provo) are working to stay ahead of the growth, but it’s difficult.

“Providing utilities is an issue. Power is an issue. We’re working on infrastructure, like improving water lines and working on new power substations. We’re trying to keep up with [growth],” says Wilson.

“There will be challenges if we don’t develop transportation and utility infrastructure. Those are the tools of the economy. Business leaders and community leaders need to be committed to provide that part of the economy,” says Holmes. “Communities do seem to be stepping up to address these issues.”

Holmes says that what he hopes to see out of Utah Valley’s success is a greater quality of life for all its residents. “Hopefully the prosperity becomes more assessable to more people.”