Utah’s unemployment rate was estimated at 5.7% in the latest month, unchanged from the 5.7% rate of the prior month.
Total Utah employment grew by an estimated 30,100 jobs during the past 12 months
* Washington County payrolls increased by 1,100 jobs (2.1%) in the past year. The unemployment rate was 7.3% in the latest month, down from 9.3% one year ago·
* The fits and starts of American job creation will provide little incentive for the nation’s central bank to deviate from current interest rate policy, a positive development for those small businesses who are net borrowers.
* The U.S. economy saw a net rise of 120,000 jobs during March, sharply below consensus expectations of a 210,000 rise. The U.S. unemployment rate declined to 8.2% in March from 8.3% in February
THE FED TO STAY ON HOLD
Disappointing US employment gains during March will provide the Federal Reserve greater support for leaving its key interest rate…the federal funds rate… at an historic low target range of 0.00%-0.25%. Such a level has been in place since December 2008. At the same time, however, it will increase financial market expectation of the Fed providing another extraordinary money creation program, referred to as “quantitative easing.”
Employment gains in March were much weaker than expected. Federal Reserve Chairman Ben Bernanke suggested in recent weeks that jobs gains could slow sharply as the economy was not all that robust. The Federal Reserve will face rising pressure to bring another round of additional monetary stimulus. However, the Fed’s leadership is likely to remain patient and closely examine additional economic and financial data in coming weeks. The Fed’s Open Market Committee is on record that it expects its key interest rate to stay unchanged until late 2014. At the same time, the Fed would like to be able to move that rate higher sooner should U.S. economic performance surprise on the upside. The level of short-term financing costs is a component of the Small Business Index for Utah.
The Zions Bank Small Business Index for Utah was 112.7 in March 2012, down from a revised 112.8 in February 2012. The Index measures business conditions from the viewpoint of the Utah small business owner or manager.
A lower Index number is associated with less favorable business conditions for Utah’s small businesses. The Index uses 100.0 for calendar year 1997 as its base year. The Index includes revisions to various historical and new forecast components as they become available.
The Utah unemployment rate—the most heavily weighted component of the Zions Bank Small Business Index for Utah—was estimated at 5.7% in the latest month, unchanged from the prior month’s 5.7% rate. The 5.7% rate compares to a 7.3% rate during the same month one year ago. A lower Utah unemployment rate is a negative contributor to the Index as it implies decreased access to Utah labor. Other associated factors typically tied to a lower unemployment rate, such as greater job creation, greater income gains, and stronger retail sales pull the Index higher.
Utah’s unemployment rate averaged 6.7% during 2011, 8.0% during 2010, 7.6% during 2009, 3.5% in 2008, 2.6% in 2007, and 2.9% in 2006. These rates compare to an average Utah unemployment rate of 5.0% during the 2001 to 2005 period, and an average 3.5% rate between 1995 and 2000.
Total Utah employment grew by an estimated 30,100 jobs (up 2.5%) over the past 12 months. This increase compares to a gain of 30,300 jobs in the prior year-over-year period. Utah added 25,600 jobs in 2011, lost 6,300 jobs in 2010, lost 63,700 jobs in 2009, lost 800 jobs in 2008, and added 49,600 jobs in 2007, 55,700 jobs in 2006, 43,700 jobs in 2005, and 30,200 jobs in 2004.
These totals compare to gains averaging 38,000 new jobs annually during the 1994-2000 period and a net loss of 1,300 jobs in 2001 through 2003. More recently, job gains leading to greater income creation and stronger retail spending, have a positive impact upon Utah’s small businesses…and therefore, the Index.
Cache County employment fell by 300 jobs (-0.6%) in the latest 12-month period. The area’s jobless rate was 4.3%, down from the 5.2% rate of one year ago.
Weber County gained 1,100 jobs (1.2%) in the latest 12-month period. Joblessness registered 6.7%, down from the 8.3% unemployment rate one year ago.
Davis County had payrolls increase by 3,300 jobs (3.3%) in the past year. The unemployment rate was 5.4% in the latest month, down from 6.6% one year ago.
Salt Lake County employment rose by 16,500 jobs (2.9%) over the year. The county’s unemployment rate was 5.4% in the latest month, down from 7.0% last year.
Utah County employment rose by 8,500 jobs (4.8%) over the last 12 months. The area’s jobless rate was 5.5%, down from the 7.0% rate of one year ago.
Washington County payrolls increased by 1,100 jobs (2.1%) in the past year. The unemployment rate was 7.3% in the latest month, down from 9.3% one year ago.
The U.S. economy’s net addition of 120,000 jobs during March 2012 was much weaker than expected. The consensus of forecasting economists was for a 210,000 job rise. The nation’s unemployment rate dipped to 8.2% in March, a three-year low. The prior month’s rate was 8.3%.
More than 1.1 million net new jobs have been added in the US economy over the past six months, with a gain of roughly 3.5 million net new jobs since the end of 2009. At the same time, such gains represent only 41% of the 8.5 million net jobs lost during the Great Recession, which ran from December 2007 to June 2009. US economic growth since the recovery officially began has been the weakest since the 1940s. It remains to be seen whether solid job gains, which lead to stronger consumer spending, will be able to lead US economic growth higher.
The American economy grew at a 3.0% real (after inflation) annual rate during 2010, only to see growth slow to a 1.7% real pace in 2011. Most forecasts see real U.S. economic growth this year near 2.2%-2.5%, better than the prior year, but substandard as it relates to prior economic recoveries.
US and global economic performance are components of the Zions Bank Small Business Index for Utah. U.S. job gains and U.S. and global economic performance are components of the US Business Index.