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Keith McCord ReportingUtah's unemployment rate dropped last month, from 5.2- percent to 5.1 percent. National figures were also released today; they're down to 6.1 percent.
These minute changes indicate the economy is still quite stagnant. But one local economist believes things are about to improve.
Today, the Department of Workforce Services issued it's forecast for Utah's economy. Things will get better, but it may be a few months yet! Believe it or not, Utah's overall employment picture --that is, available jobs, and numbers of people working-- is still being affected by what happened in the 1990's.
High tech jobs back then boomed! As the Internet became a daily necessity, more jobs were created. Then came Y2K and the high tech industry had yet more work to do. The state's economy grew and grew, until it was "overbuilt."
Mark Knold, DWS Senior Economist: "So what we're looking for as we go forward, is when will we see the signs of this overcapacity? Everything that happened in 1990's, when will we absorb this?"
It won't be overnight, but economist Mark Knold of the Department of Workforce Services says tech jobs are beginning turn around. He says statistics can be a bit misleading. For example, Utah's jobless rate only dropping one-tenth of one percent last month doesn't look promising for the total economic picture. Knold says despite that, the turnaround could already be underway.
Mark Knold, DWS Senior Economist: "Employment is what we call a 'lagging' indicator. The economy can take off and start to grow, and it takes some time for that to trickle into the business community, then to hire more workers."
That "lag", he says, could be as long as 6 to 8 months.
One other factor that gives economists headaches as they make their forecasts is "productivity." We hear government agencies report that the nation’s productivity levels are up. Sounds good, but in some cases that means companies are accomplishing more with fewer people.
Mark Knold, DWS Senior Economist: "So it's very possible for the business community to expand their services, expand their output, and not have to hire any more workers. And if the productivity is so high, they can actually shed some workers, let it go."
In general, the Department of Workforce Services believes Utah's economy is slowly improving. Mark Knold says it'll probably be sometime in 2004 before we see the numbers to prove it.