Carbon's unemployment rate stabilizes, but labor market remains negative
Carbon County's unemployment rate has remained constant, registering at 5.8 percent in April and May.
The current jobless rate represents a significant improvement compared to the 8 percent unemployment level reported by the county in May 2003, according to data compiled by the Utah Department of Workforce Services.
But the second primary indicator of local labor market conditions, the year-over change in the number of non-farm wage and salaried positions, reflects an economy struggling to recover.
Workforce services data indicate employment in Carbon County dropped 6.3 percent with more than 600 jobs lost between May 2003 and May 2004.
At the state level, the unemployment rate registered at 4.6 percent in May, a slight upward movement from 4.4 percent joblessness in April.
The year-over change in the number of non-farm wage and salaried employment opportunities statewide remained steady at 1.5 percent with 16,300 more jobs than last May.
"I'm encouraged by the employment growth in Utah. We would like to see a higher rate of growth, though. But I'm optimistic that we will continue to climb toward those levels as this year progresses," noted Raylene Ireland, Utah Department of Workforce Services director.
Seasonally adjusting the statewide gains would place Utah's employment at slightly less than 2,000 jobs shy of the peak reached in January 2001.
"The overall upbeat pace of the U.S. economy is a plus for Utah. Not only does this overall increase generate new and expanding business opportunities for Utah companies, but Utah's long-term history is such that we generally outperform the U.S. economy in terms of employment growth. As we expect this relationship to hold, the better the U.S. economy does, all the better over-and-above-that for the Utah economy," commented Mark Knold, DWS senior economist.
The majority of the state's industrial sectors are showing employment growth. Last year, the sectors were shedding jobs. But the current economic rebound is permeating throughout the bulk of the Utah, and United States, economy.
The only two industries without employment gains are the information sector and financial activities. Financial declines are new to the economic scene in Utah. The sector actually grew throughout most of the recessionary period.
The financial was one of the few bright spots at locations across the state, driven by low mortgage interest rates that spurred employment gains in mortgage financing and refinancing. But the apparent end of the spurt comes as no surprise, as it appears mortgage interest rates are poised to rise as the overall economy improves, indicated the workforce services representatives. Most people who are not forced" to pursue new housing financing options have already locked themselves into historically low rates.
This was one of the biggest pushes in America's history in terms of using houses as a sort-of consumer ATM. But this phenomenon has run its course. The end result is that mortgage activities should contract significantly.
In contrast, the information sector has been slumping since the statewide recession started three years ago, continued the workforce services representatives.
The telecommunications industry is the primary reason for this slump. Its prospects of improving are probably going to be further delayed, until next year. The turnover rate of hardware in the industry has generally shown a five-year cycle. The last one was the run up to Y2K, so next year would mark that five-year anniversary, pointed out workforce services.
It is anticipated that a reinvestment cycle should benefit this industry next year, but until then, DWS officials assert that Utahns should continue to see this industry be one the economy's laggards.
The strongest driver in the economy has now become professional and business services. This is welcome news. A good portion of this is increases in the temporary help industry. But there is also good rates of growth in many of the professional, high-paying areas like architecture, engineering, legal services, and computer systems design. This is a major plus for the economy and is a foundational sector that trickles its economic benefits down to other industries.
Health care continues to be strong, with continued labor shortages in some key skills areas keeping this industry hungry. Health care is an important component in the Utah and Carbon County economy and its expansion is important. But that expansion is a theme that has been presented time-and again in these economic press releases over the past three years.
Construction continues to bounce back from its three-year contraction. The industry gained 1,700 new year-over positions, and employment stands around 69,000. The figure is only about 5,000 off its peak seen in early 2000.
Since there are significant portions of the workforce that are nationally or regionally transitory, it's quite possible that the 5,000 fewer jobs could be equal to the number of transitory workers who wandered into Utah during the peak years, explained the state agency representatives. If so, the situation means that the overall spending impact of the lost wages because of fewer jobs may be minimal, as a significant portion of the money was flowing out of the state anyway, back to the folks at home.
Retail trade activity is also springing back to life across Utah. The overall trade, transportation, utilities sector added around 3,500 new jobs over the past year.
Most of the activity is in retail trade, an industry whose fortunes parallel population growth.
The retail sector is not immune to occasional over- or under-building. That was recently the case, as retail trade overbuilt leading up to the recession and has since, of necessity, contracted.'
But Utah population growth continued throughout the recessionary period and, therefore, it's possible that just as the sector previously overbuilt, retail trade may now be slightly under-built, concluded the department of workforce services representatives.