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PROVO — Utah's economy has bounced back from the COVID-19 pandemic and the state "leads the nation in its economic recovery," Rep. Robert Spendlove said at a Utah County Chamber of Commerce event on Wednesday.
Spendlove, R-Sandy, described to the attendees how COVID-19 impacted the economy, both in Utah and across the country, and showed data supporting that the economy is returning to normal including the gross domestic product, producer price index, employment and labor force participation.
"Our state continues to be the shining star for the entire country. Over the last 10 years, Utah was the fastest-growing state in the country," Spendlove said.
Utah and Idaho were the only two states to gain jobs, rather than lose them, between February 2020 and August 2021. Utah's unemployment rate is currently 2.6%, compared to a national rate of 5.4%. Spendlove said that Utah is doing so well partially because the state is seeing people come back into the workforce at rates higher than the national trend.
Nationally, 22 million jobs were lost in two months during the spring of 2020, and currently the number of jobs is only 5 million less than it was before that drop; however, there are 11 million open jobs right now. Spendlove said this is because there is a disconnect between the jobs that are available and the jobs that people want.
Spendlove said economists have not seen a significant difference in workforce rates between states that ended the enhanced unemployment in June and those that continued through September, but that there is something holding people back from working. He said it could be the overall federal support.
"The federal government is giving us too much money," Spendlove said, citing the direct payments, enhanced unemployment, and the per child credit. "It's giving us so much support that we don't really need to work."
Spendlove explained that the federal government has been "creating out of thin air" $120 billion dollars each month since the beginning of the COVID-19 pandemic by buying $80 billion of treasury securities and $40 billion of mortgage-backed securities. He said that the government, however, announced on Wednesday that it is going to begin pulling this spending back because of concerns that the economy might be overheating and it could have negative consequences, specifically for inflation.
Former Gov. Gary Herbert, who also spoke at the event, said when he became Utah's governor in 2009 it was in the middle of the worst state economic time since the Great Depression and he set a goal to make Utah the "best-performing economy in America." Herbert worked on the goal with Spendlove, who at the time worked with policy for the governor's office.
Herbert said that he focused first on economic growth and development and put together a "commonsense program" which included having no irresponsible debt and giving power to the private sector to allow them to build the economy.
According to Spendlove, the nation's economy is also doing well and has been gradually returning to the numbers seen before the pandemic. The gross domestic product is now higher than before the recession in 2020, which was not expected. Spendlove said that consumer spending has allowed the GDP to come back from its collapse during the second quarter of 2020.
Consumer confidence, however, has been dropping recently and job growth also slowed in August.
"The national economy continues to be strong. We are entering in a period of weakness, the delta variant has created uncertainty, it's dropped down that consumer confidence, it's constrained overall economic growth, GDP appears to be a little bit slower than we'd expected — but … I think this is going to be kind of a traditional slowdown," Spendlove said.