Jobless rate indicates Utah economy slowing
Utah's seasonally adjusted unemployment rate was estimated at 2.7 percent for January, according to department figures released Tuesday. The yearly revision of unemployment data is still under way, so the department said it won't release the state's official unemployment rate until Feb. 27. The 2.7 percent is the department's estimation of what that rate will be when it is officially published.
Total employment in the state grew by 4.5 percent over the past 12 months, continuing the slight downward trend over the past six months. (The state's employment growth rate for December was revised down from 4.7 percent to 4.4 percent.) About 52,400 jobs were created during the past year.
"Even though the economy probably doesn't feel any different to the average worker or business, the numbers are showing that the luster is fading somewhat on the Utah economic expansion," Mark Knold, the department's senior economist, wrote in the report.
"The employment growth rate is slowing. Fortunately, it is not slowing because of any negativity coming from the marketplace in terms of less demand for goods and services. Instead, it is an expanding economy that is finding the pool of available new workers growing smaller and smaller."
By and large, employers that pay high wages are still finding available workers, the department reported. However, Knold wrote, "it is the businesses that hire workers at the lower end of the wage ladder that have the most trouble finding workers in this current environment."
When the numbers are all in, the data likely will show that 2006 was a worker's economy, in more ways than one, Knold said.
"Since labor is highly mobile and people's natural tendency is to look toward increased wages, turnover activity in the marketplace increases noticeably in this environment," Knold wrote.
"Employers find they need to increase wages to either retain existing workers or to attract new workers. This wage bidding becomes more pronounced in a high-growth, low-unemployment economy such as Utah's. Therefore, wage increases for 2006 are projected to be the highest in 15 years, with overall wage gains of 5.4 percent."
E-mail: jnii@desnews.com
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