Carbon County's economy grows despite unemployment
Carbon County's economy continues to generate expanding employment despite the fact that the local jobless rate climbed by one-half of a percentage point in June.
The latest data compiled by the Utah Department of Workforce Services indicate that Carbon's labor market reported 10,249 civilian employment opportunities in June 2009, representing a 7.5 percent job growth rate from last year's 9,977 figure. In June 2009 and June 2008, active participants in the local labor force totaled 9,556 and 9,516 respectively.
Nevertheless, Carbon's unemployment rate registered at 6.8 percent in June 2009, with 693 unemployed residents. By comparison, 647 displaced workers were searching for jobs in May, when Carbon County's unemployment rate registered at 6.3 percent.
At the state level, Utah's non-farm wage and salaried job contracted by 3.7 percent in June, according to data generated by the United States Bureau of Labor Statistics. Approximately 46,100 jobs have been removed from the Utah economy during the last year, lowering total wage and salary employment to 1,215,400 statewide.
Utah's second primary indicator of labor market conditions, the unemployment rate, rose to 5.7 percent in June from last year's 3.3 percent jobless level. Approximately 78,100 and 46,000 Utahns were considered unemployed in June 2009 and June 2008 respectively.
At the national level, the United States unemployment rate continued to escalate, reaching 9.5 percent in June.
"We can speak of the Utah economy and its situation, but the Utah economy is not going to act independently of the national economy," noted DWS representative Mark Knold. "Therefore, the key to seeing Utah's future is to focus upon the national economy and to monitor its prospects. Nationally, job losses were higher than expected in June, yet they were lower than expected the month before, in May. Which month was the anomaly? Probably both. If the employment profile of the two months are averaged, it fits nicely into the trend pattern of employment declines of the past 16 months. That's not to say more job losses are a good thing, only that of the past 16 months. That's not to say more job losses are a good thing, only that the heavy job losses in June are probably not an indication that the economy has jumped off track. A tepid economic rebound beginning sometime in the next six months is still anticipated."
The road to recovery will be a long one, with employment and jobless numbers being one of the last variables to respond, predicted the state department of workforce services economist.
"A Utah rebound in output will move hand in hand with the rise in national output," explained Knold. "Many analysts believe that will occur during the second half of 2009. If so, the earliest an employment rebound can be expected in Utah would then be sometime during the first half of 2010.
The extreme shock to the nation's financial sector is the primary culprit of this economic downturn. As the Utah economy did not avoid the national financial impact, it will not develop any kind of economic rebound in defiance of the economic drag that continues to plague the nation's economy."
Utah's financial sector lost 3,000 labor force positions during the last year, while the state's construction industry dropped 18,000 jobs and the manufacturing industry shed 13,300 employment opportunities.
"Probably the major reason for the relative moderation in financial losses is that Utah did not have a major Wall Street presence within the framework of its financial structure. Banks, credit unions, credit card centers and mortgage activities make up the bulk of Utah's financial framework," noted the DWS economist. "Where the financial collapse hit Utah hardest was in the construction sector - particularly in residential construction. The precursors to the financial bubble fueled a housing boom and housing price run-up in Utah. Home building flourished. This caused a construction industry thatis normally around 6 percent of the Utah employment base to swell to nearly 9 percent. In retrospect, this was an employment percentage not sustainable by historic standards, and then pendulum was destined to swing. Anytime economic variables are out of kilter with their historical norms, either a boom or bust environment is underway. Time always brings it back into balance. It was the shutting down of the credit markets that had the greatest impact upon pulling back Utah's construction industry,"
On the positive side of the employment spectrum, Utah's population growth acts as the driving force behind the two industries managing to add jobs during the current downturn - health care and education. But the state's public and higher education systems may not continue to post labor market growth as 2009 progresses.
"It will be interesting to evaluate when the next school year begins in August whether Utah's education community will be able to maintain, let alone expand upon, its teaching base in the face of strained budgets," concluded Knold.