2018 Economic Report to the Governor

//2018 Economic Report to the Governor
2018 Economic Report to the Governor2018-06-20T10:16:30+00:00

2018 Economic Report to the Governor

For over two decades, the Economic Report to the Governor has served as the preeminent data source on the Utah economy. The 2018 Economic Report to the Governor is the 30th annual publication in its series.  It is a collaborative endeavor of the David Eccles School of Business and the Governor’s Office of Management and Budget and is prepared by the Utah Economic Council.

The Utah economy remains healthy. Every major industrial sector expanded in 2017, contributing a total of 43,500 new jobs over the year. An annual employment growth rate of 3.1 percent is on par with the state’s long-term average and among the strongest
in the nation. Utah’s construction sector posted the highest job growth in 2017, 5.4 percent, fueled by both robust residential and commercial activity. The value of permit authorized nonresidential construction was $2.4 billion in 2017 led by a record-setting $520 million in new office construction. The demand for construction workers will increase in 2018 with major public and private construction projects underway including the $3 billion re-development of the Salt Lake International Airport; the new $600 million state prison; the 855,000 square foot Amazon fulfillment center; $1 billion in state road construction (2018-2020); and the start of $600 million in voter-approved public school construction. Low unemployment and rising wages for Utahns, along with growth in travel and tourism activity – Utah’s ski resorts and national parks hosted a record number of visitors in 2017 – contributed to exceptionally strong job growth of 5.1 percent in the state’s leisure and hospitality sector over the past year.

Utah’s population surpassed the three million milestone in 2016. Utah is currently the third fastest in population growth in the nation at 1.9 percent (behind Idaho and Nevada). Net inmigration of almost 27,000 in 2017 was the most since 2006 and contributed to 46 percent of the state’s total population growth. The consensus forecast predicts moderating – but still healthy – job and wage growth, low unemployment, and increased net in-migration in 2018. Internal risks to the Utah economy this year and beyond include the supply of workers, increasing costs, increasing interest rates, air quality, and housing affordability. A late business cycle may also present challenges in the upcoming year. Economists will also monitor the impact of federal tax reform.

Demographic advantages, an appealing business climate, and increasing labor force participation will continue to be an advantage for the Utah economy. All going well, Utah’s economy will once again be one of the top performing economies in the nation in 2018, albeit at a slower rate.