Unemployment currently at all-time low in Utah
It hardly seems possible, but Utah’s latest unemployment numbers, already the lowest in the nation, are still declining. That news is actually not all good.
The national unemployment rate in April was 3.6%. That’s a return to pre-pandemic levels economists say points to a strong economy.
Utah is in an even than the country as a whole: Department of Workforce Services numbers for April show unemployment here at just 1.9%. That’s lower than the previous two months – and the lowest in the country.
In the Wasatch Back, April data puts Summit County’s unemployment at 1.7% and Wasatch County’s at 1.8%. Only Cache, Juab, Morgan and Utah counties are lower in Utah.
All of this may be great news for workers, but not so much for employers struggling to find people to take jobs.
Mark Knold, a chief economist with the state, said Utah’s current situation is unprecedented.
“We've never been lower," he said. "This is a really interesting environment in which we're in. So if you're a worker yourself, you are of great value. And when something is of great value and in short supply, why the price of it goes up? You're really at a spot where a body that's breathing is hirable. Not very often have we seen economies like this.”
The need to pay more to attract and keep workers is a national trend playing out here too. But he said the Wasatch Back, unlike even the Wasatch Front, faces particular challenges because it’s not as economically diverse as other places.
"You have an interesting dynamic up your way," he said. "You have people who come there to recreate to get away. I'm coming into your economy. I'm offering nothing to the economy in terms of labor or helping you produce goods and services but I want goods and services."
Knold said some economies have a pretty evenly distributed number of consumers and producers . But he said, generally, the U.S. is in a bind due to the aging of Baby Boomers. That generation, born between 1946 and 1964, contained nearly 80 million people at its peak according to US Census data. Everything about the United States grew along with the Baby Boomer labor force.
"For the last 40 years they've been working in squeezing and inching their way into the economy and making it bigger and wider and buying homes and buying another home, buying cars getting careers," he said. "By this time in their lives, they have stretched the entire United States economy to its maximum. They did not reproduce themselves in equal numbers. In other words, there isn't enough bodies behind the baby boom generation to backfill the economy."
Now baby boomers are retiring and are still consumers but are no longer producers. Knold called it a very long-term labor shortage story that the pandemic exposed.
He said there’s a sweet spot of sorts with respect to unemployment rates. There is no one number that applies across the board, but somewhere around 3.5%-4% can provide what he described as a healthy balance.
That doesn’t appear to be coming to Utah anytime soon. Utah’s unemployment rate is an outlier, and the state’s challenges aren’t the country’s challenges, Knold said.
“We're dealing with a state like Utah that needs to manage growth over the next 20 years inside of an economy that is trying to manage contraction."
He said nationally, the most obvious solution he sees is bringing more people into the United States from other countries. Another solution is to allow the economy to shrink, but he said that creates other problems, such as housing gluts instead of shortages, and unused infrastructure that can't be maintained.
For the time being, it’s a job-seeker’s paradise, in Utah and across the country.