Utah employment losses continue

Utah employment losses continue
Jobs » But the rate shows the recession is slowing.

By Mike Gorrell, The Salt Lake Tribune
01/22/2010 08:13:53 AM MST

Utah's unemployment rate rose almost half of a percentage point in December to 6.7 percent -- the highest since it was 6.8 in March of 1987.

The number of Utahns considered unemployed rose to 91,200 from 86,200 in November.

At the same time, however, the state had only 34,700 fewer jobs last month than in December 2008. That's an improvement over the 38,800 jobs that had been lost in a year-to-year comparison between the Novembers of 2008 and 2009.

And Utah's unemployment rate remains far below the 10.0 percent national average.

How can these divergent numbers co-exist?

The analogy that comes to mind for Mark Knold, Utah Department of Workforce Services chief economist, is this:

"Say I'm a patient who is ill. I'm at a point where I'm lying in bed and wanting to die. The next day, I don't feel as bad, but I'm still sick," Knold said.

"That's where we are right now in this recession. Am I still sick? Yes. Am I recovering? Yes. You can say 'yes' to both at the same time."

Fourteen months after the financial collapse sent the national and state economies reeling, The upshot, is "the current employment picture is not repeating last year's free fall," Knold wrote in his monthly employment summary.

"Utah's economy remains weak, but indications are that, at worst, the economy has stabilized and found a bottom," he added. "At best, it is starting to expand and meekly add jobs again."

Pete Taylor, a vice president for the Sandy-based affiliate of Management Recruiters International, shares Knold's perspective.

"A year ago, companies were paralyzed," he said. "There's not that same feeling now. Some companies are moving forward, filling positions that have been on hold or they haven't felt the urgency to deal with. But there's a lot of caution."

Knold's report for December said the retail-sales industry was representative of the slightly improving situation. Employment during the peak of the Christmas sales period was up by 800 over the previous year.

That upturn prompted Tricked Out Accessories, which has 15 locations in Utah, to open three more next month in Hawaii, said Marc Patterson, a regional manager of the company that sells cell phone and iPod accessories from stores and mall kiosks.

"December was our biggest month ever as a company. And January is still looking to be really good," he said, noting that Tricked Out Accessories has grown to 50 employees. "If retail wasn't doing good, we wouldn't be able to open new stores and hire more people."

At the end of 2009, health care remained Utah's strongest industry, adding 6,200 new jobs to payrolls during the year. The construction industry was the year's big loser, dropping 12,200 positions or 14.9 percent of its work force from December of 2008.

The ski season's slow start resulted in the leisure and hospitality sector eclipsing manufacturing as the state's second hardest-hit industry. It lost 8,800 jobs in 2009, a 7.8 percent decline, while manufacturing companies pared 8,500 jobs, a 7.1 percent drop.

"Restaurants have lost the most jobs in this sector, yet there are also losses in the accommodation industry as well," Knold said.

But like the state economy as a whole, he saw improvements in this sector that were not reflected in the numbers.

"The psychology toward the ski season is better. Last year, the economy was just starting into its free fall and people froze up like ice cubes. People were very reticent about taking ski vacations," he said.

"But now, even though the economy is bad, that gloom-and-doom psychology isn't there," Knold added. "There just isn't as good of snow. So if we have a big dump, people might not have the hesitation about taking a ski trip."

mikeg@sltrib.com
---

New jobless claims

First-time claims for unemployment in Utah last week mirrored a surprising jump nationally that showed how scarce jobs remain in the road to economic recovery.

The Utah Department of Workforce Services reported Thursday that 4,284 new claims were filed in the week ending Saturday, down from 4,368 the previous week but still higher than any week since early February 2009. The four-week average of 3,690 new claims also was the highest since mid-March of last year.

Nationally, 482,000 new claims were submitted, up from 446,000 the previous week and the highest level since mid-November. The four-week average was 448,250, the U.S. Labor Department reported.

"The trend in the data is still discouraging," Diane Swonk, chief economist for Mesirow Financial, wrote in a note to clients. "Hopes for a positive employment number in January ... are rapidly dimming."

Source: The Associated Press contributed.