Successful economies grow organically. They grow even better when supported by smart policies. Utah’s economy has led the nation consistently in recent years, nurtured by a dynamic governor and an attentive legislature. 

But every year brings new challenges, and there is no lack of uncertainty for business these days: valuations are down, interest rates have made debt capital expensive and inflationary pressure on wages and supply chains makes it hard to plan ahead. And, yes, talent remains hard to find (we need more engineers)! 

In light of these headwinds, what are some of the economy-shaping tools Utah’s policymakers have at their disposal—and how might they deploy them in 2024? We’ve identified some of the key economic tools wielded at the state level, and we’ve collected the wisdom of some of Utah’s smartest and most plugged-in professionals to provide insights into the coming year. 

Policy tool #1: Innovative legislation

Utah legislators are bursting with ideas. For 2024, we may already be at a record number of bill requests. Most of these won’t end up being passed into law—but many will, and some initiatives will affect businesses more directly than others. 

Ginger Chinn, head of public policy and government relations for the Salt Lake Chamber, had the following thoughts on what we might expect in the upcoming legislative session.

“The unofficial theme of the 2023 Legislative Session was on the delicate balance of managing growth. In 2024, I anticipate a continued emphasis on this sentiment, particularly concerning housing, transportation and water issues. 

I also foresee the introduction of AI legislation in the upcoming session, with a notable impact on businesses. The proposed AI bills are expected to predominantly address concerns related to privacy and consumer protection, reflecting a growing awareness of the need for regulatory frameworks in the rapidly evolving field of artificial intelligence. Utah is seeking a proactive approach by lawmakers to ensure responsible and ethical AI implementation within the business landscape. 

In addition, we know that small businesses play a pivotal role in job creation within our communities and contribute to our overall economic growth. Unfortunately, business owners often grapple with burdensome regulations that increase operational expenses. Policymakers have the opportunity to enhance economic growth and alleviate costs for entrepreneurs, workers and consumers by working toward the elimination or reduction of such regulations.

Our workforce is facing significant challenges due to soaring housing prices. We have a supply and demand problem. State legislators and local authorities can implement policies aimed at expanding the housing supply, thereby assisting in controlling housing costs. Potential measures include reforming zoning regulations to increase land availability, permitting higher housing density in desirable areas, easing restrictions hindering new home development, expediting permit approvals and eliminating minimum lot requirements, among other proposed reforms.”

Policy tool #2: A smart budget

As a general matter, government spending creates opportunities for businesses, if not directly than simply as a matter of economic stimulus. However, the shape of the budget also matters. For example, prioritizing some parts of the budget over others can create an environment that benefits business generally—or potentially even specific sectors. 

Adam Gardiner, a principal at ASG Strategies and VP of government relations for 47G, shared some views on what we might expect for the state’s budget for 2024:

“For the last few years, legislators have made a concerted effort to reduce income taxes in the state from 4.65 percent to 4.55 percent, which adds up to around $400,000,000. The legislature is facing a leaner year, and so the days of tax cuts could be gone for the next few years. As the legislature invests more and more into public education and continues to fund vouchers to stay competitive, income tax revenue needs to stay healthy. Utah’s Economic Opportunity Commission will also be recommending the expansion of some manufacturing and machinery tax credits to help foster development and innovation as the economy becomes uncertain and inflation continues to put a strain on business expenses. If you’re feeling the strain in your business, remember the state is also forced to deal with the same inflation and rising costs, and that makes our schools, roads and power more expensive. 

The one takeaway from smaller budgets isn’t to think of this as any type of crisis but rather the economy right-sizing itself after years of federal COVID-19 and Inflation Reduction Act spending. The money that was allocated to states for a variety of projects through COVID is going away if it hasn’t been spent yet and states are getting back to their normal budget process. As one member of the executive appropriations committee put it to me, ‘We are going from boom to balanced.’

Going back to the boom and balanced message, I think it will be interesting to watch the state focus on one area of massive investment and income potential (energy) and one that will undoubtedly cost the state hundreds of millions of dollars more (homelessness and mental health) but will hope to encourage more investment into the state if they make progress. Utah has invested nearly $400,000,000 in water projects to “save the Great Salt Lake” and more than $20,000,000 into a housing loan fund for first-time homebuyers. I’ll be watching to see if they double down on those investments or if they play it safe and analyze their successes over the next few years. 

With the announcement that Utah will be hosting the 2034 Olympic Winter Games, I will also be looking to see what infrastructure projects (roads and public transit) they plan for. It’s unlikely they will start any major funding on that front just yet.”

Policy tool #3: Economic development & promoting Utah (around the world)

Through resources like the Governor’s Office of Economic Opportunity (GOEO) and World Trade Center Utah (WTC Utah), the state has the ability to promote Utah businesses in the broader marketplace. This effort is important to keep the state’s economy diversified and resilient. It also improves Utah’s influence around the world, which can have a multiplier effect back home. What is in store for 2024? Here’s what Jonathan Freedman, CEO of World Trade Center Utah, has to say:

“During trade missions to France, the United Kingdom and Mexico this year, Gov. Spencer Cox signed three strategic initiatives focused on boosting trade and bilateral relationships with our top trade partners. 

Long known as the crossroads of the West, Utah is quickly becoming the crossroads of the world. Each year, GOEO and WTC Utah partner to direct governor-led trade missions and lead Utah companies in key sectors at international trade shows. The 2024 lineup includes the Singapore Airshow, Farnborough Airshow, Medica (in Düsseldorf) and ISPO Munich.

Upcoming governor-led trade missions include visits to Canada in the spring and Southeast Asia in the fall. Additionally, Utah regularly welcomes international diplomats. During these visits, WTC Utah, in partnership with GOEO and the Salt Lake Chamber, hosts business roundtable discussions. These forums facilitate direct interactions between Utah businesses and foreign dignitaries, fostering discussions about business opportunities in their respective countries.”

Policy tool #4: Education and training initiatives

Despite a slowing economy, skilled and trained talent remains perhaps the key need for many of Utah’s most strategic sectors, particularly manufacturing and logistics. Andy Pierucci leads government relations at Savage, a multinational logistics company headquartered in Salt Lake. He notes:

“The biggest constraint for every industry in Utah is workforce. The state has already been incredibly responsive to the need for career-focused education, particularly for skilled positions. Significant resources are being dedicated to talent and workforce development, and the state is convening people to find solutions for the industry at large. Skilled and trade labor continues to be culturally undervalued, and the state has an important role to play, in coordination with industry, in rewriting this narrative.”

Ginger Chinn seconds this view.

“Looking ahead, I anticipate seeing legislative proposals specifically focused on career-oriented education, with targeted initiatives for industries such as life sciences. This proactive approach aligns with the recognition that addressing the skills gap is essential for the success of businesses and the state’s overall economic vitality.”

Policy tool #5: Leaning into our advantages

In contrast to many other states, Utah does an amazing job recognizing its advantages and leaning into them. This is intentional work of first understanding its unique spaces and being strategic about them. Grant Baskerville, government affairs advisor to doTERRA and chair of the Utah Direct Selling Coalition, explains:

“Despite being landlocked, Utah is arguably one of the most globally connected states in the United States. One thing that has supported these efforts is the regulatory and legislative approach taken by the state legislature and governor. One such example is the passage of SB.83, the Cosmetic Manufacturing Certificate Program, in the 2022 General Session. 

In short, an increasing number of countries require a state or federally-issued Certificate of Good Manufacturing Processes (GMP) for Cosmetics. Without this certificate, Utah businesses would not have been able to export their cosmetic goods. In response, the state legislature and governor passed and put in place a law that created a clear, robust and voluntary system of GMP inspection and certification to address this problem. 

It is important to recognize and celebrate the full range of industries that contribute to Utah’s economic growth and success. By way of example, and as highlighted by the Kem C. Gardner Policy Institute’s economic analysis from August 2022, Utah’s direct selling industry supports over 38,000 well-paying jobs, constitutes over $6.3 billion in international exports, contributes over $144 million in state and local taxes, and has attracted over 294,000 out-of-state and international visitors to Utah for conventions in the five years preceding the COVID pandemic. 

Soon, the state’s economy-shaping tools will be in full deployment. On January 16, Utah’s legislative session begins. Admittedly, what happens in it may have only a marginal (if any) impact on the broader economy, but it will directly affect the business environment for companies that operate here. That will help determine, over time, the type of economy Utah will enjoy in the future.