Utah's unemployment rate rose to 6.8 percent in January, but economists upbeat

Utah's unemployment rate rose to 6.8 percent in January, but economists upbeat

By Mike Gorrell
The Salt Lake Tribune
Updated:03/02/2010 02:04:09 PM MST

Despite a slightly higher jobless rate in January (6.8 percent), state economists said monthly employment data released Tuesday reinforce perceptions of economic improvement.

"Signs that the worst of the economic downturn are behind Utah continue to emerge," said Mark Knold, chief economist for the Utah Department of Workforce Services.

The number of nonfarm wage and salaried jobs in Utah in January was down 2.9 percent from the same month a year earlier, he noted. That rate of contraction, which translates into 35,300 fewer jobs, was up a bit from December (2.8 percent). But it was still below year-to-year comparisons for the summer and fall of 2009. They were up to 4.5 percent.

Knold also cited continued evidence of new jobs being created. "The number of Utah job openings posted on various Internet Web sites have been rising for several months. In addition, new unemployment insurance claim activities are beginning to moderate noticeably," he added.

Still, the unemployment rate rose to 6.8 percent, up from December's revised figure of 6.6 percent (December earlier was listed at 6.7 percent).

At 6.8 percent, about 91,500 Utahns were considered unemployed in January compared to 77,600 a year earlier. The U.S. unemployment rate for January, announced two weeks ago, was down to 9.7 percent, from 10 percent in December.

Acknowledging that a higher unemployment rate seems to contradict perceptions that the worst is over, Knold said a rise in jobless numbers "is expected at this stage in an economic rebound.

"The worst of the employment slide seems to have found its bottom around August 2009, although the job market is still in more of a stabilizing than an expansion mode," he added. "At best a slight economic recovery is underway, and if so, historically, the unemployment rate continues to rise during this stage for an undetermined length of time."

Knold said the unemployment rate also tends to creep up during this phase of recovery because idled workers who previously had stopped looking for work, "begin to trickle back into the job search arena ... Until they find a job, they actually push up the unemployment rate."