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Utah Economic
Report
The Governor’s Utah Economic Summit
April 10, 2012
Innovation
and
Investment
Olympic Math
 Viewers -- 2.1 billion from 160 countries
 Guests of state -- 350 VCs and 600 corporate guests
 World leaders -- 77 countries and 8 presidential
Cabinet members
 Visitors – 220 thousand
 Print media -- $22.9 million in earned advertising
 Torch relay -- 11,250 people carried the torch in 46
states
 Subsequent games -- Torino and Vancouver Games
 Subsequent events -- Seven World Cups or U.S.
Championships
“The Olympics remain the most
compelling search for excellence
that exists in sport, and maybe in
life itself.”
- Dawn Draser, Australian swimmer, 3-time winner of Olympic Games.
Utah
Economic
Basics
$115 Billion
Gross State Product
Rank 33rd
In size among states
Less than 1%
of U.S. economy
Utah job
growth 2.5%
Compared to 1.6% nationally
Fastest Growing Economies
Source: GOPB Analysis of Bureau of Economic Analysis Data
Job growth Feb. 2011 – Feb. 2012
0.0% 2.0% 4.0% 6.0% 8.0%
Louisiana
Colorado
Texas
Utah
Oklahoma
North Dakota
2.1%
2.2%
2.6%
2.7%
2.8%
6.8%
Year-Over Percent Change
Utah has the third
fastest growing
economy in the country
Gross Domestic Product by Industry 2010
3%
5%
13%
17%
4%
22%
11%
7%
3% 3%
14%
3%
4%
12%
14%
5%
21%
12%
9%
6%
2%
13%
0%
4%
8%
12%
16%
20%
24%
Ag. Nat'l
Res. & Min
Const. Mfg. Trade,
Trans., &
Utilities
Information Fin'l Prof. & Bus.
Services
Educ. &
Health
Leisure Other Serv. Gov't
Utah U.S.
Source: Bureau of Economic Analysis
Economic Diversity
90.8
91.6
91.8
92.1
92.2
92.7
93.3
93.6
94.0
95.3
88 89 90 91 92 93 94 95 96
Florida
Washington
Minnesota
Tennessee
Utah
California
Pennsylvania
Colorado
Missouri
Illinois
Source: GOPB Analysis of Bureau of Economic Analysis Data
Hachman Index: Ten most diversified economies in the country
Utah Employment
1,020
1,070
1,120
1,170
1,220
1,270
1,320
00 01 02 03 04 05 06 07 08 09 10 11 12
Source: U.S. Bureau of Labor Statistics; March 2012
Seasonally adjusted
Peak to trough a
loss of 80K-90K
jobs!
PEAK
Trough
Utah Job Growth
Monthly Year-Over Percent Change
-4.4%
-4.1%
-3.3%
-3.1%
-2.8%
-2.9%
-2.3%
-1.9%
-1.4%
0.7%
1.0%
1.5%1.5%1.5%
1.2%
1.5%
0.8%
1.5%
1.8%
1.6%1.5%1.6%
2.1%
2.5%
2.9%
2.7%2.7%
2.5%2.5%2.6%2.5%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
August-09
Sep-09
Oct-09
Nov-09
Dec-09
Jan-10
Feb-10
Mar-10
Apr-10
May-10
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
March-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Source: Utah Department of Workforce Services and Salt Lake Chamber
Modest expansion
Healthy expansion
Utah Job Growth
Monthly Year-Over Percent Change
-4.4%
-4.1%
-3.3%
-3.1%
-2.8%
-2.9%
-2.3%
-1.9%
-1.4%
0.7%
1.0%
1.5%1.5%1.5%
1.2%
1.5%
0.8%
1.5%
1.8%
1.6%1.5%1.6%
2.1%
2.5%
2.9%
2.7%2.7%
2.5%2.5%2.6%2.5%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
August-09
Sep-09
Oct-09
Nov-09
Dec-09
Jan-10
Feb-10
Mar-10
Apr-10
May-10
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
March-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Source: Utah Department of Workforce Services and Salt Lake Chamber
Training wheels
Free-riding
Utah Job Growth by Industry
February 2012
0 2 4 6 8 10 12
Government
Other Services
Leisure and Hospitality
Education and Health
Prof. and Business
Financial Activities
Information
Trade, Trans, Utilities
Manufacturing
Construction
Natural Resources
Total
0.0
2.1
0.3
3.0
3.9
4.4
4.5
1.9
4.3
4.9
10.1
2.6
Year-Over Percent Change
Source: Utah Department of Workforce Services
Critical issues
 Discouraged workers
 Housing
 Oil prices
Discouraged
Workers
Pre-recession labor force participation rate
72%
Post-recession labor force participation rate
66%
50
55
60
65
70
75
76 81 86 91 96 01 06 11
Utah Labor Force Participation
Source: U.S. Bureau of Labor Statistics; LAUS: January 2012 LAUS = Local Area Unemployment Statistics
Employed
Unemployed
Number of
unemployed if
participation
rate of past 20
years held –
133,600 people
Employed %
at a 28 year
low
No significant change in last recession
1,000,000
1,100,000
1,200,000
1,300,000
1,400,000
1,500,000
1,600,000
1,700,000
04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19
Utah’s Potential Timeline to Recovery
Trend without the Recession
Recovery Path
Employed
Housing
0
5
10
15
20
25
30
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012f
2013f
2014f
Thousands
of
Units
Single-Family Multi-Family Total
Utah Residential Construction Activity
Source: University of Utah, David Eccles School of Business, Bureau of Economic and Business Research
Utah’s Housing Stock
Year Housing Stock Housing Stock
Change
Excess Housing
Inventory
2010 982,400 10,900 18,600
2011 991,900 9,400 12,900
2012 1,000,600 8,700 6,900
2013 1,010,600 10,000 1,000
2014 1,023,600 12,500 -5,100
2015 1,039,200 15,600 -11,300
Ivory Homes, Ivory Institute
Oil Prices
Oil Prices 101
 A penny increase in the cost/gallon costs consumers
$1.25 billion over the subsequent year.
 Gas prices are up 60 cents since late 2011.
 U.S. consumers will take a $75 billion hit this year.
 If prices rise further the entire $100 billion tax cut will
be erased.
“An issue ignored is
a crisis invented.”
- Henry Kissinger
U.S.
Concerns
Oil prices
European debt crisis
Policy paralysis
Over regulation
U.S. corporate tax rate
Utah
Concerns
National economy
Education
division/complacency
State-level immigration reforms
Infrastructure complacency
1st Law – For every economist there
exists an equal and opposite
economist.
2nd Law – They are both wrong.
- David Wildasin
Two Economic Laws
U.S.
Optimism
Best universities
Best capital markets
Best rule of law
Near-best demographics
Utah
Optimism
Downtown Rising
International trade
Marquee expansions
Internal population growth
Western hub
PAC 12
Public policy leadership
Utah Economic Summit - Natalie Gochnour 2012 04-10

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Utah Economic Summit - Natalie Gochnour 2012 04-10