Utah economy to remain strong for decades

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Every sector of Utah's economy added jobs in 2006, just one sign of a "rip-roaring" economy, Gov. Jon Huntsman said Thursday.

Utah added nearly 60,000 non-farm jobs last year for a total of more than 1.2 million, led by increases in mining, construction and manufacturing. Construction accounted for a quarter of the new jobs.

Huntsman was gloating over those and other statistics prepared by his economic advisers in an 226-page annual report, telling business and government leaders the state's economy was "on fire."

"The fundamentals look like we're going to have another good year," Huntsman told the gathering at the University Marriott Hotel. "I'm absolutely thrilled."

Utah's economy is off the charts by many measures. Huntsman's advisers say they've never seen it so strong, with job growth running nearly four times the national average.

The governor's chief economist, Robert Spendlove, predicted job growth would remain at least twice the national average for the next three decades. In an interview, he said he makes projections that long for water, transportation and infrastructure needs for a growing population.

"Utah is unique demographically compared to the rest of the nation," he said. "We have the largest household size, the highest fertility rate, the third-highest life expectancy and the lowest median age."

Utah also has the nation's second-highest education attainment rate, as measured by the 92.5 percent of the adult population with a high school diploma, he said.

"It means Utah has a young, well educated, productive, dynamic work force that's very attractive to employers," Spendlove said.

The state's largest economic sector involves the movement of goods and services. Grouped together, wholesale and retail trade, transportation and utilities accounted for 234,800 jobs, up by 8,900, according to the report compiled by Huntsman's Office of Planning and Budget.

Other leading sectors are government and professional and business services.

The construction sector added the most jobs, 14,800 last year, for a total of 122,800, it said.

The value of all construction in Utah last year was more than $7 billion, led by nearly 30,000 new houses.

Another $2 billion in new construction and renovation is planned for downtown Salt Lake City over the next five years. The Church of Jesus Christ of Latter-day Saints has started demolition of three city blocks for a new retail core, a project valued by state economists at $1.5 billion.

Wages, meanwhile, were up by an average 5.4 percent last year, the biggest jump in 14 years, Spendlove said.

Utah has only to worry about a labor shortage, which could restrain job growth this year, economists said. Huntsman said 1,000 engineering jobs were going unfilled in Utah because of the shortage.

People moving to Utah are helping to fill that gap, including a growing Hispanic workforce described in the economic report as largely "invisible."

Utah had a confirmed net migration of 30,000 residents in 2006, plus 52,000 births -- the highest birth count of any year in state history, Spendlove said.

Among the downsides of the vibrant economy is traffic congestion and crowded schools.

Traffic is increasing twice as fast as the population and "we're not keeping up," said Carlos Braceras, of the Utah Department of Transportation. "There's less open space on the roadway."

Braceras said the one-hour evening commute between Salt Lake City and Provo could grow to three hours in 25 years if Utah does nothing to improve the highway or mass transit system.

The burgeoning school population is causing a teacher shortage that Huntsman blamed partly on paltry salaries, which vary by school district.

"I think the rates we're paying our teachers is embarrassingly low," he said.

Utah's average starting salary for teachers is $26,130, according to the American Federation of Teachers.

This story appeared in The Daily Herald on page A1.

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