Utah economy 'chugs along'
May's total employment rose by 3.4% for state
Utah's unemployment rate was down 0.4 percentage points to 4.9 percent in May, the department reported. About 60,700 people were jobless last month, compared to an estimated 63,300 in May 2004.
"We're kind of just chugging along," said Mark Knold, senior economist at the department. "We're moving along at the same pace we have over the last six months or so, after the big build-up from 2003 to 2004. We've hit the high point, and now we're on the plateau, so to speak."
Total employment, the year-over change in the number of non-farm wage and salaried jobs, increased by about 37,000 jobs, or 3.4 percent, in May. April's total employment change also was revised down 0.1 percentage point, to 3.4 percent.
Professional and business services led the way, adding 7,600 jobs in the May 2004-May 2005 period, according to the department. Of those, Knold said 4,700 jobs were in higher-paying categories, such as professional, scientific and tech- nical service jobs.
The construction industry also performed well, bringing on 6,800 new workers in the year-over period. About 6,000 new jobs were added in the trade, transportation and utilities sector, while the education and health sector reported 3,800 new jobs in the year-over period.
"I think the (job) growth rates will still be good, in the mid-3 percent range," he said. "But I don't anticipate it going any higher than that for the rest of the year. That's not a downer. It's just that 2004 got better and better, so we're comparing against a stronger period. To get higher growth rates, you not only have to match what happened last year, you have to exceed it. I think we've reached the peak and are now riding the plateau."
The national jobless numbers showed similar steadiness. Earlier this month, the U.S. Labor Department reported that the unemployment rate was 5.1 percent, down from 5.2 percent in April 2005, and significantly down from 5.6 percent reported in May 2004. About 7.6 million people nationwide were without work last month.
Total employment fell short of analysts' expectations, at 78,000 jobs, the Labor Department reported.
Looking ahead, Knold said he's bullish about the economic conditions in the West. Idaho, Nevada, Arizona and Oregon continue to post strong growth numbers along with Utah, he said. The only real concerns might be in the bigger picture.
"If there's a concern, it's along the lines of the national economy," Knold said. "It's about the housing bubble bursting in some areas. It's about energy prices getting out of hand. But I don't really anticipate anything happening there, this year. Next year is probably more vulnerable in that respect."
Housing prices in Utah have increased in some areas recently, Knold said, but that doesn't mean the state will be folded into any bubbles.
"It's not cause for alarm, because our prices were dipping below the national average," he said. "Hopefully, it's a move toward the national level. We still have a long way to go to build any kind of bubble in this market.
"There's a small possibility that anything will come about this year. The odds are much higher for a continued strong economy. There's legs under this economy, and it would take something fairly good to knock it off balance. The national legs are a little shakier than Utah's legs."
E-mail: jnii@desnews.com
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