Unemployment Improving as Utah Moves to the New Normal

With the coronavirus pandemic having effectively brought commerce to a halt, the local economy is certainly feeling it — but less intensely than other parts of the country. Utah’s unemployment was up to 9.7 percent in April from a paltry 2.5 percent in February and 3.6 percent in March.

This was higher than at any point during the Great Recession when unemployment topped out at 8.0 percent in the spring of 2010. “Utah’s strong economy preceding this pandemic offered more cushion against disruption than seen across the rest of the country, thus Utah’s more moderate setback,” said Mark Knold, Chief Economist at the Utah Department of Workforce Services.

However, the April rate is still lower than every state other than North Dakota (8.5 percent). Things are starting to improve, though, since Utah has gradually allowed businesses to reopen during the past month. The Utah Division of Unemployment Insurance reported 4,996 new unemployment claims for the last week of May; this marks the first time since the pandemic started that the new weekly claims fell below the previous record high of 5,300 in 2013.

But those new claims are not even across the state. The five counties that had the highest number of individuals filing new unemployment insurance claims at the end of May are Salt Lake (37 percent), Utah (19 percent), Davis (8 percent), Weber (7.6 percent), and Washington (3.7 percent). “The consistent decreases continue to be encouraging. With restrictions lifting and economic activity gradually returning, it is important to remember these benefits are temporary and refusals to return to work will result in a loss of benefits for most who are not determined to be at high risk for the illness,” said Kevin Burt, Unemployment Insurance Division director for the Utah Department of Workforce Services.

A newly-released analysis from United States Commercial Real Estate Services (CBRE) shows that the Wasatch Front was the least impacted for year-over-year April job losses among the 40 large U.S. metro areas studied. The area saw unemployment levels 6.6 percent higher than those reported in April 2019. Phoenix, Arizona and Dallas, Texas tied for second best at 7.6 percent higher.

April’s unemployment levels vary across Utah, but tourism-dependent counties have suffered the greatest impact. Grand County, home of tourist favorite Moab, saw the state’s largest unemployment increase from February to April: 22 percent — double the national average. Other tourism-dependent counties also saw increases at or above 10 percent: Garfield (17 percent), Kane (12 percent), San Juan (10 percent), and Wayne (10 percent). The hit to tourism seems to have driven unemployment hikes in Summit (18 percent) and Wasatch (14 percent) counties.

Utah’s tourism and tourism-related industries have seen significant economic drop-offs as a result of the pandemic. In Utah, this decrease hit around 90 percent— from about $26 million in spending per day down to $3 million. The only other county that saw an increase in unemployment from February to April above 10 percent was Uintah County, which is heavily dependent on the energy sector.

Meanwhile, the National Bureau of Economic Research said Monday that the American economy hit its peak in February and is officially in a recession — bringing to a close a record-long expansion of 128 months.

If an individual’s employment has been impacted by the pandemic, updated information (including help for employees and employers returning to work), can be found at jobs.utah.gov/covid19.

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