Utah's Recession Expected to Continue for at Least 9 to 12 More Months

Utah's recession is expected to continue during the next 9 to 12 months before a modest upturn during 2010's second half, according to the Summer 2009 issue of Zions Bank's "Insight - Economic News of Utah and the Nation" released today. 

"Many residents of the Beehive State had perhaps developed a mindset that the state's economy was largely immune from what happens across the nation or around the globe," said Jeff Thredgold, economic consultant to Zions Bank and author of "Insight."   "Such views were dashed during the past 18 months as Utah slipped into its most serious economic decline in decades."

Utah's unemployment rate has nearly doubled, averaging 5.2 percent in recent months versus the state's 2.7 percent annual average during 2007.  However, the 5.2 percent jobless rate still ranks among the six lowest rates in the nation, with only Iowa, Nebraska, North and South Dakota, and Wyoming recording lower rates in April 2009. The U.S. unemployment rate in May was 9.4 percent.

The quarterly "Insight" publication features updates on current and projected economic and financial developments for the state of Utah, the nation, and the global economy. The Summer 2009 issue also examines the flow of funds to Social Security and Medicare.  Following are a few highlights from the Summer 2009 issue of "Insight":

* The Utah economy has lost roughly 40,000 net jobs during the past 12 months, a painful 3.2 percent decline. Nearly three of every four jobs lost during the past year have been in the construction and manufacturing sectors. Better news saw the natural resources sector add 1,700 jobs.

* Utah home price declines appear relatively modest when viewed against much greater declines in Arizona, California, and Nevada, where prices in major cities within those states have fallen an average of 47% versus their highs in 2006 or 2007, according to the S&P/Case-Shiller 20-city index. 

* Denver-based Mountain Travel Research Program estimated that total lodging expenditures in 15 mountain destination communities in California, Colorado, Utah, and British Columbia fell 25 percent versus the prior year. Those resort communities with a greater share of local skiers, including many in Utah, did somewhat better.