Taylorsville Workforce Services photo taken on April 15, 2021. Utah’s unemployment rate hit a record low of 1.9 percent in April, according to a report released Friday. (Kristen Murphy, Desert News)
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SALT LAKE CITY — Utah labor officials reported Friday that the state’s seasonally adjusted unemployment rate slipped to a record low of 1.9 percent in April after holding steady at 2 percent for several months.
The report provides all signs that Utah’s economy is still recovering well from restrictions imposed by the COVID-19 pandemic that began two years ago, said Mark Knold, chief economist at the Department of Workforce Services. Those effects are now in the “rearview mirror,” he argues, as Utah is one of 11 states with more jobs now than it was before the pandemic.
“Job creation continues to be rapid, as labor supply allows,” he said in a pre-recorded message released Friday. “Utah tops state-level economic performance.”
The state’s unemployment rate had fallen to around 2.5% in March 2020 before surging to around 10% the next month. Since then, it has been slowly declining, returning to 2.5% again in September 2021, before falling to an all-time low from December. About 33,000 Utahs are currently listed as unemployed.
The national tax rate is 3.6%.
The report also left economists wondering how low could interest rates go? Utah’s current unemployment rate means it’s already hard to find new labor, and it will become increasingly difficult as the unemployment rate hits an all-time low. Nord warned that new challenges could soon appear in the state’s economy.
“Ready labor is now a precious commodity,” he said.
His warning came with a caveat, though. There is no sign that record-low unemployment will slow the state’s economy anytime soon, the report said. Utah added 62,400 jobs over the past year and nonfarm payrolls rose 3.9%, bringing the statewide total to 1,664,800 jobs.
Knold explained that Utah’s youth are getting older and more people are moving to the hive state, which helps find new labor when other states are struggling. Contrary to “aging”, the state also has a 20-year “aging” trend. This is what he calls the “foundational platform” for Utah’s continued economic success.
“A strong economy attracts workers. New workers keep the economy strong and growing,” he continued. “This strength and growth attracts more workers, and the cycle becomes entrenched until some exogenous factor rises, interrupting it like the pandemic has for most of 2020.”
Utah Gov. Spencer Cox touted the report on Friday, tweeting that his office is “for the hardworking Utah people who contribute to the strongest economy in America. proud”.
Meanwhile, Knode also noted on Friday that the U.S. economy as a whole is not sending any troubling signals right now. This could change if high inflation continues to affect the country.
Utah’s “diversified economy” is helping Utah cope with record inflation, Cox said at his monthly news conference on Thursday, but a recession will still affect the state. When asked about the Fed’s recent plans to raise interest rates to slow inflation, he said the federal government was “on the right path.”
“Sadly, it took them too long to get there,” he said. “Other federal policies that shouldn’t have gotten us this far have exacerbated this. We’ve delayed some of the reckless and unnecessary spending that I see as a Biden administration. An increase of at least two or three (percentage) points…inflation. “
The governor added that he hopes the U.S. economy doesn’t slip into a recession, but the state’s so-called “rainy day” funding is now as plentiful as ever, just in case.