Utah Economic Report

The Governor’s Utah Economic SummitApril 11, 2013

Natalie GochnourAssociate DeanDavid Eccles School of BusinessUniversity of Utah

Utah’s race to the top

U.S. economy “bumbling” along

What should keep us awake at night?

City/state reborn

Outline

A tribute to economic leadership

Utah’s race to the top

2009 2010 2011 2012 2013(f)

-6.0%

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

-5.1%

-0.6%

2.3%

3.3% 3.5%

Utah Job Growth Rate

Source: Utah Department of Workforce Services, Governor’s Office of Management and Budget and Salt Lake Chamber

2009 2010 2011 2012 2013(f)

(80,000)

(60,000)

(40,000)

(20,000)

-

20,000

40,000

60,000

(63,837)

(7,217)

27,030 39,031 43,700

Utah Job Creation

Source: Utah Department of Workforce Services, Governor’s Office of Management and Budget and Salt Lake Chamber

2007 2008 2009 2010 2011 2012 2013(f)

-

20,000

40,000

60,000

80,000

100,000

120,000

36,766

51,100

105,645 109,041

90,062

76,998 73,000

Utah Number of Unemployed

Source: Utah Department of Workforce Services, Governor’s Office of Management and Budget and Salt Lake Chamber

2009 2010 2011 2012 2013(f)0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

7.6%

8.0%

6.7%

5.7%5.2%

Utah Unemployment Rate

Source: Utah Department of Workforce Services, Governor’s Office of Management and Budget and Salt Lake Chamber

2009 2010 2011 2012 2013(f) -

5,000

10,000

15,000

20,000

25,000

19,600

4,500

2,300

5,000

10,400

Utah Net Migration

Source: Utah Governor’s Office of Management and Budget

2009 2010 2011 2012 2013(f)

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

-4.5%

3.0%4.6% 5.0%

4.2%

Utah Personal Income Growth Rate

Source: Utah Governor’s Office of Management and Budget

2009 2010 2011 2012 2013(f) -

5

10

15

20

25

$10.3

$13.8

$19.0 $19.1$21.0

Utah Exports

Source: World Trade Center Utah

(in billions)

2009 2010 2011 2012 2013(f) -

2

4

6

8

10

12

14

16

18

10.5 9.3

8.8

12.7

16.0

Utah Dwelling Unit Permits

Source: Utah Governor’s Office of Management and Budget, Revenue Assumptions Working Group

(in thousands)

2009 2010 2011 2012 2013(f)

-10.0%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

-8.8%

-7.3%

6.7% 6.9%

4.0%

Utah Retail Sales Growth Rate

Source: Utah State Tax Commission and Utah Governor’s Office of Management and Budget

Top Seven Job Growth States

Source: Bureau of Labor Statistics

January 2012 – January 2013

North Carolina

Washington

Colorado

Nevada

Texas

Utah

North Dakota

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0%

2.2%

2.3%

2.5%

2.5%

2.9%

3.1%

5.4%

Year-Over Percent Change

Utah has the 2nd fastest growing

economy

U.S. average = 1.5%

Utah Job Growth by IndustryFebruary 2013

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 2.0 4.0 6.0 8.0 10.0 12.0

0.3

2.6

7.8

3.2

4.4

6.2

11.54.5

3.5

6.7

0.0

4.0Chart Title

Year-Over Percent Change

Source: Utah Department of Workforce Services

A criticism of economic leadership

U.S. economy bumbling along…

-- Mark Twain

The difference between the right word and the almost right word is the difference between lightning and lightning bug.

Job Losses in Recent Recessions

Source: CalculatedRiskBlog.com and the Bureau of Labor Statistics

U.S. New Monthly Payroll Jobs

Source: CalculatedRiskBlog.com and the Bureau of Labor Statistics

U.S. Unemployment Rate by Duration

Source: CalculatedRiskBlog.com and the Bureau of Labor Statistics

Besides North Korea

What should keep us awake at night?

Fiscal insanity

Utah education warning signs

Certain uncertainty

Risks

Fiscal Insanity

Fiscal Crises Naming Conventions

• Debt ceiling stand off (August 2011) ANDREA

• Super Committee deadline (December 2011) BARRY

• Fiscal cliff negotiations (Fall 2012) CHANTEL

• Fiscal cliff (January 2013) DORIAN

• Start of sequestration (March 2013) ERIN

• Debt ceiling revisited (May 2013) FERNAD

• Next crisis GABRIELLE

Utah Fiscal Checklist

Balanced Budget

Requirement

Line Item Veto

AAA Bond Rating

Rainy Day Fund

Appropriation

Limitation

BondLimitation

U.S. Fiscal Checklist

Balanced Budget

Requirement

Line Item Veto

AAA Bond Rating

Rainy Day Fund

Appropriation

Limitation

BondLimitation

Utah Education Warning Signs

Percent Utahns with Bachelor’s Degree of HigherBy Age Cohort: 2011

25-34 35-44 45-64 65 plus TOTAL20.0%

22.0%

24.0%

26.0%

28.0%

30.0%

32.0%

34.0%

29.3%

31.5%

30.5%

26.4%

30.4%

Source: American Community Survey, 2011

Utah College Completion Rates are Falling

Utah’s Math Test Score Rankings are Headed in Wrong Direction

1992 1996 2000 2003 2005 2007 2009 20110

5

10

15

20

25

30

35

12 12

18

28

24

2827

19

1012

1918

2930

2526

4th Grade 8th Grade

Source: National Center for Education Statistics, The Nation’s Report Card

Utah’s rank among states

Utah Ranks Last Among Peer States

US

New

Jers

ey

New

Ham

pshi

re

Verm

ont

Min

neso

ta

Wyo

min

g

Sout

h Dak

ota

Uta

h200

205

210

215

220

225

230

235

2 3 20

23

25

31

Source: Utah Foundation and National Assessment of Educational Progress

4th Grade Reading Test Scores: 2009

5

National

Rank

Certain Uncertainty

Unchartered waters

The future is bright

A City/State Reborn