UTAH’S CURRENT ECONOMIC OVERVIEW
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UTAH’S CURRENT ECONOMIC OVERVIEW April 2014 Mark Knold Supervising Economist Utah Department of Workforce Services PowerPoint PPT Presentation


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UTAH’S CURRENT ECONOMIC OVERVIEW April 2014 Mark Knold Supervising Economist Utah Department of Workforce Services. Recovery. Prosperity. Peak. Trough. Expansion. Contraction. Anatomy of a Business Cycle. Economy. Time. State by State Employment Decline. Peak to Trough Decline.

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UTAH’S CURRENT ECONOMIC OVERVIEW April 2014 Mark Knold Supervising Economist Utah Department of Workforce Services

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UTAH’S CURRENT ECONOMIC OVERVIEW

April 2014

Mark Knold

Supervising Economist

Utah Department of Workforce Services


Recovery

Prosperity

Peak

Trough

Expansion

Contraction

Anatomy of a Business Cycle

Economy

Time


State by State Employment Decline

Peak to Trough Decline

Source: U.S. Bureau of Labor Statistics.


Utah Employment % Change*

1960 – 2013

Employment Change

Average per year: 3.1%

60

70

90

80

00

10

Source: U.S. Bureau of Labor Statistics, QCEW. Through December 2013. * Based on O-T-Y Not Seasonally Adjusted.


Recovery

Prosperity

Peak

Trough

Expansion

Contraction

Anatomy of a Business Cycle

Economy

Time


State by State Employment Recovery

From Recession Trough to Current

Source: U.S. Bureau of Labor Statistics; February 2014 Current Employment Statistics estimates.


Recovery

Prosperity

Peak

Trough

Expansion

Contraction

Anatomy of a Business Cycle

Economy

Time


State by State Recession Employment Rebound

From Pre-Recession Peak Employment to Current Employment

Source: U.S. Bureau of Labor Statistics; February 2014 Current Employment Statistics estimates.


Utah Employment

2000 – 2013

Thousands

Source: U.S. Bureau of Labor Statistics; March 2014


Utah 16+ Population Estimate

Thousands

Source: U.S. Bureau of Labor Statistics; January 2013, CPS Population Estimates


Utah Employment

2000 – 2013

Labor Force Growth

Employment

66,000

Source: U.S. Bureau of Labor Statistics; March 2014


Unemployment

U.S. and Utah


Utah Avg. Wage Growth and Unemployment Rate

1991 - 2013

Inverse Relationship

Source: Utah Department of Workforce Services


Utah Labor Force Percent Participation

1990 – 2014

Percent

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Utah LFP and UnRate

2008 – 2014

Un Rate

% LFP

Unemployment rate drops while LFP declines; Implies “discouragement” or missing opportunities

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Labor Force Participation That Left*

2008 – 2014

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics

* Diff between pre-recession level and recession


Labor Force Participation That Left

2008 – 2014

Unemployment rate drops while “discouragement” or missing opportunities increase

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Utah Employment-to-Population Ratio

1990 – 2014

Percent

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Utah Employment-to-Population Ratio

2008 – 2014

% E-Pop

Un Rate

Unemployment rate decline not driven by employment gains

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Unemployment

U.S. and Utah


Unemployment Rate

2004 - 2014

Note: Pre-recession variables is holding the labor force participation rate at pre-recession levels.


Labor Force

2004 – 2014

66,000

92,000

Source: U.S. Bureau of Labor Statistics; Local Area Unemployment Statistics


Change in Labor Force Participation Rate

2007 – 2011

2007 - 2013

Source: U.S. Bureau of Labor Statistics


Change in Labor Force Participation

2007 – 2011(blue)

2007 – 2013(gray)

Source: U.S. Bureau of Labor Statistics


Utah Nonfarm Industry Profile (Numeric Change)

2007 - 2013

Employment loss from pre-recession peak to recession low

Employment gain from recession low to September 2013

Natural Resources

Construction

Manufacturing

Trade, Trans., Utilities

Information

Financial Activities

Prof., and Business

Education and Health

Leisure and Hospitality

Other Services

Government

Source: U.S. Bureau of Labor Statistics, QCEW


Private Sector Employment in High Wage and Low Wage Industries

2000 - 2013

Employment

Source: Utah Dept. of Workforce Services; March 2014

The average wage for all industries is the dividing line between high-wage and low-wage.


Private Sector Employment % Chg. in High Wage and Low Wage Industries

2000 - 2012

Employment Change

Source: Utah Dept of Workforce Services; March 2014

The average wage for all industries is the dividing line between high-wage and low-wage.


Part-Time Employment in Utah

1997 - 2012

Source: U.S. Bureau of Labor Statistics


Would Rather Have Full-Time Employment in Utah*

1997 - 2012

Source: U.S. Bureau of Labor Statistics *% of part-time who would rather work full-time.


Women Have A Higher Propensity for Part-Time Employment

1997 - 2012

Utah Data

Source: U.S. Bureau of Labor Statistics


Would Rather Have Full-Time Employment in Utah*

1997 - 2012

Source: U.S. Bureau of Labor Statistics *% of part-time who would rather work full-time.


Metro Areas Rebounding Faster Than the Non-Metro Areas

2004 - 2013

Source: Utah Department of Workforce Services


Strong Rebound in the Provo Area

2004 - 2013

Source: Utah Department of Workforce Services


Utah Employment by Establishment Employment Size

2000 – 2012 Avg.

Source: U.S. Census Bureau, Local Employment Dynamics


Various Comments of United States Economic Forecast

U.S. Economic fundamentals continue to improve.

U.S GDP growth of 2.5% - 2.7%.

Unemployment lowering to around 6.5%.

Employment growth of around 1.7%.

Job gains frequently over 200,000 a month.

Mortgage rates climbing toward 5.5%.

Federal government fights less economically disruptive.

FED stimulus of the economy easing (tapering), but not difficult to crank it back up.


Utah Commercial Real Estate experts are looking for a strong 2014

Sold $1.4 B in industrial investment in 2013. Expect to repeat in 2014.

Office absorption up, vacancies down, rents up, new construction.

Retail added 1M sq. ft. in 2013; looking for continued levels of activity.

Distribution looking for 1.9M new sq. ft. in 2014


Utah Expectation for 2014

Job growth from 3.5% to 3.8%.

I expect 4.0% to 4.2% in 2015.

I am an optimist.

Base this on improved U.S. performance for 2014 and 2015.

Unemployment will be low, but still masking the underutilization of Utah labor.

Therefore, wage growth could still be below average.

Normally in-migration would be a contributing factor, but could still be weak.


Utah Employment

2003 – 2014f

Monthly

Employment (000)

Where employment would need to be to keep up with labor force growth (assumes no in-migration).

Two-Year Forecast

Forecast

8.0% Employment Growth Over Next Two Years

Source: Utah Department of Workforce Services; April 2014 f = forecast


Utah Employment Growth by Establishment Employment Size

2010 – 2012 Avg.

Source: U.S. Census Bureau, Local Employment Dynamics


Utah Employment by Establishment Age

2000 – 2012 Avg.

Source: U.S. Census Bureau, Local Employment Dynamics


Utah Employment Growth by Establishment Age

2010 – 2012 Avg.

Source: U.S. Census Bureau, Local Employment Dynamics


County by County Recession Employment Rebound

From Pre-Recession Peak Employment to Current Employment

Source: U.S. Bureau of Labor Statistics, QCEW employment


Utah County-Level Hachman Indices

2012

0.4

0.6

1.0

0.8

0.2

Diminishing Diversity

Source: Utah Dept. of Workforce Services


2003 – 2012 County Employment Growth and Hachman Indices


County by County Recession Employment Rebound

Low

High

High

From Pre-Recession Peak Employment to Current Employment

Low

Low

High

Low

High

High

High

High

High

High

High

High

Source: U.S. Bureau of Labor Statistics, QCEW employment


Stretching the economy to accommodate new workers

Stretching the economy to accommodate new workers

Worker Vacuum

Worker Vacuum

U.S. Population by Age and Sex: 2010

Utah’s Population by Age and Sex: 2010

Male

Female

Male

Female

Millions

Dominating the Labor Force

Source: U.S. Bureau of the Census


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