By: Phil Dean
Note: The opinions expressed are those of the author alone and do not reflect an institutional position of the Gardner Institute. We hope the opinions shared contribute to the marketplace of ideas and help people as they formulate their own INFORMED DECISIONS™.
Utah’s economy has proven to be incredibly resilient over the past year. While some sectors face continuing challenges, on the whole the state’s economy has dramatically recovered from the pandemic-induced decline that began in March 2020. Utah is poised for further growth as the virus’ spread moves toward further containment. Although economic risks remain, as widespread containment occurs, the combined effect of accumulated savings and significant pent-up demand will support enhanced economic activity, particularly in the most-challenged economic sectors.
Looking Back at March and April 2020
While many had heard of a strange new virus moving through countries like China and Italy, this vague problem from faraway places abruptly became stark reality for Utahns almost overnight when Utah Jazz star players Rudy Gobert and Donovan Mitchell tested positive for the COVID-19 virus nearly a year ago. In quick succession, not only did the NBA shut down, but previously strong economic activity suddenly took a nosedive.
Widespread virus-created uncertainty, combined with rapidly emerging private and public sector responses to that uncertainty, took hold. As consumer and business leader confidence plummeted and public health guidelines increased, unemployment rose dramatically from all-time lows. As shown in Figure 1, in April 2020 Utah’s unemployment spiked to 10.4%, a rate unseen in decades, while the national unemployment rate peaked at 14.8%. Given the prior economic strength both locally and nationally, this sudden jolt caught most off guard.
Figure 1: Unemployment Rate in Utah and U.S., 1980–2020