By Matt Schroeder
Post-recession economic recoveries are long and arduous processes no matter what, but recessions involving financial crises are historically even slower. Utah and the Wasatch Front North have been plugging along steadily for the last few years recovering jobs at an average rate of 2 to 3 percent per year and reaching a point where most counties have surpassed pre-recession levels. Yet economists still talk in terms of recovery rather than in terms of normal economic expansion. Why is that? How do we know when the recovery is complete?
There are a variety of indicators that economists look at when determining the relative progress of a recovery. One important one is the unemployment rate. When the unemployment rate bottoms-out (i.e. when it stops falling), it may be a sign that labor markets have reached a “natural” or stable state, and thus recovered. In the Wasatch Front North, the unemployment rate fell 0.6 percentage points from December 2013 to December 2014, indicating that the recovery may not yet be complete, but it continues to edge ever closer.
- Year-over-year payroll employment growth in Davis County accelerated to 3.6 percent in the third quarter of 2014 gaining momentum compared to the 3.2 percent growth of the second quarter. The increase represents 4,030 more jobs compared to the same time last year with the construction industry leading the way adding 775 new jobs since the third quarter 2013.
- Davis County’s unemployment rate continued on a downward trajectory to 3.3 percent in December. This is more than a half percentage point drop since December 2013, and is well under the state average unemployment rate of 3.5 percent.
- The average number of initial unemployment claims filed per week in the fourth quarter of 2014 was 139 claims, about 46 fewer claims than the fourth quarter 2013 weekly average of 185 claims.
- Average monthly wages picked up to 3.2 percent year-over-year growth in the third quarter and outpaced statewide growth of 1.6 percent after having grown only 0.8 percent in the second quarter of 2014. Davis County’s average monthly wage came in at $3,300, close to Utah’s average of $3,429. Wage growth has remained relatively subdued over the course of the recovery, so the uptick is a welcome sign of potential improvement.
- As employment strengthens and wages start to catch up, the expectation is that consumer and business spending will pick up as well and Davis County is no exception. Year-over-year change in taxable sales showed strong growth of 8.3 percent in the third quarter, reaching nearly $1.19 billion.
- The manufacturing industry increased sales by $10.8 million compared to the same quarter last year, and multiple retail industries including motor vehicles, clothing, food and beverages, and building materials were also large contributors with respective sales increases of $8.8, $7.0, $6.1, and $5.5 million.