Although a nearly dry labor pool is stunting Utah's job growth, the dearth of workers is pushing up wages at the highest rate in more than a decade as employers try to sweeten the allure of their openings.
From January 2006 to last month, Utah's job growth rate was 4.5 percent. That was up a tick from December's revised 4.4 percent and down nearly a full point from a peak of 5.4 percent in June 2006. Only about 35,300 Utahns were without jobs in January, down sharply from 52,700 a year prior.
Nationally, unemployment rose to 4.6 percent from December's 4.5 percent. Year-over job growth nationally dipped from 1.6 percent to 1.4 percent in January.
But if the state's economy no longer is white hot, it still is sizzling, said Mark Knold, chief economist for the Department of Workforce Services.
"It's like pushing a car full-speed down a steep hill and beginning to run out of gasoline," he said Tuesday. "You still keep going fast, it's just that one of your indicators is running into restrictions."
The tight labor market also has meant competition over available workers. An indicator is the 5.4 percent average wage increase Workforce Services noted between January 2006 and last month - the highest such increase recorded in 15 years.
In Utah, the availability of jobs continues to simply outstrip the resident population's ability to fill
them. January's unemployment rate was 2.7 percent, up slightly from December; with 52,400 jobs created over the past 12 months, the jobless rate still was well under the 4.0 percent Knold says effectively reflects full employment.
The unemployment "rate is still rock bottom. We're at a point where, more and more, we will have to depend on in-migration of workers - from other states, even other countries - for employment growth."
Jeff Thredgold, a Zions Bank consultant, agrees that a "major constraint to even stronger Utah economic performance is a lack of people to hire, [and] such tight labor availability should lead the . . . economy to slow modestly" as this year continues.
"Even so, we expect Utah to remain among the top 10 states in employment growth," Thredgold noted in his most recent economic outlook newsletter.
The construction industry continued to lead the way on job creation, adding 13,500 jobs in the past year. However, that sector of the economy could see employment growth slow some in coming months.
"The number of new [construction] jobs added will moderate somewhat," Knold predicted. "New-home permit approvals are running below last year's record levels, so as a result, construction employment demand will moderate."
Construction employment grew 16.3 percent over the past year. A close second was the natural resources and mining sector, adding 1,400 jobs for a 15.4 percent improvement. Trade/transportation/utilities added 8,600 jobs (up 3.8 percent), while the professional/business segment created 8,200 positions (5.6 percent).
The trucking subsector alone was up 5 percent in job growth, creating 900 positions for a total of 18,600 employees.
"Things are going very well for us," said Kelle Simon, president of Kelle's Transport (formerly Simon Trucking). "Things got just a bit slower after the holidays, but that's traditional in this market. Things should pick up again in the second quarter."
Kelle's Transport has seen its work force, now 95 strong, and its business jump by more than a third in the past year, Simon said.
Only the information sector showed little growth, coming in at just 100 new jobs the year over, for a 0.4 percent growth rate. Knold blamed that primarily on layoffs that came before and after America Online's sale of its 400-employee Ogden call center last October to Teleperformance USA.
But that sector's job-creation performance should improve. Teleperformance spokesman Mark Pfeiffer said his company expects to steadily hire new staff in coming months.
"Right now we are at 280 employees. [AOL] was down to about 320 and about to shut down when we took over," he said. "Our intention is to stabilize operations, save those jobs and grow the center toward its full potential."
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