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Keith McCord Reporting This is the time of year when economic experts start looking into the "crystal ball" and make predictions for the new year. The latest came today.
Economic experts are pleased with the Utah picture in all areas, except perhaps at the gasoline pump. Ask just about anyone who's crunched Utah's numbers and they'll all use the same word to describe our economy "vibrant!"
Sterling Jenson, Reg. Managing Dir. Wells Capitol Mgmt.: "I think it's a favorable part of the United States. I think we're being discovered. We're receiving some of the flow from California."
This morning, Utah businesspeople got a briefing from Wells Fargo analysts about the economic and investment outlook for 2006, and based on what happened in 2005, there is optimism. Job growth for one:
Sterling Jenson, Reg. Managing Dir. Wells Capitol Mgmt.: "This past year, the employment level grew by 3.9%, versus the national average of 1.5%. And so that clearly put us in the top five nationwide for growth rates for the states. I suspect we'll still stay somewhere in the top 10."
Construction industry jobs really drove those numbers; of the 44,000 new jobs added in Utah last year, 10,000 were in construction.
Housing prices rose like crazy in 2005, especially in places like California, but the increases are expected to slow down some this year.
Sterling Jenson, Reg. Managing Dir. Wells Capitol Mgmt.: "We're hopeful that we won't see the kind of price increases we saw over the past year. That was clearly unsustainable, nationwide as housing prices jumped 15 to 20%. I think will get back to a more normalized level."
Probably in the neighborhood of 3 to 5%. The bad apple in all of this are gasoline prices. While there is optimism that the price-per-barrel of oil will drop below 60-dollars, it's probably unlikely. Which means, pump prices this year will be between two and three dollars a gallon.
Sterling Jenson, Reg. Managing Dir. Wells Capitol Mgmt.: "Maybe the midpoint of that will be the average for the coming year. We're becoming more accustomed to that, but I think if we have an oil shock, and it goes above three-dollars, that will be a real hurt to the consumer."
Yes he did say we're becoming more accustomed to three-dollars a gallon! The other thing that can affect gasoline/oil prices are political problems in other countries, and we certainly have that going on.
