About half of the state's population growth was from natural increase — the number of births minus the number of deaths, or 37,512 people. Net migration — the number of people moving into a place minus the number of people moving out — accounted for the rest, or 40,647 people.

"Utah's population is younger, women tend to have more children, people on average live in larger households, and people tend to survive to older ages," the report said. "All these factors lead to an age structure that is quite unique among the states."

Utah continued to have the largest household size in the nation with 3.01 people per household, compared to 2.60 nationally, the report said.

Kelly K. Matthews, executive vice president and economist at Wells Fargo Bank, said 2005 was a peak year.

"There is just no way that we can expect to build more houses this coming year and maintain those growth rates," Matthews said. "But at the moment those long-term interest rates are not going up. We'll probably have a pretty darn good summer in homebuilding."

Matthews said the state's biggest challenges going forward are dealing with the state's population growth, education and transportation needs.

"We are just growing very rapidly, and that poses some real challenges," Matthews said. "Fortunately it's much easier to handle when you have good surpluses."

The report projected that economic growth in 2006 would slow, with all economic indicators — such as employment, wages and exports — posting lower gains compared to 2005.

The state ended the 2005 budget year with a surplus of $105.7 million, the report noted, after distributions to various funds.

Other noteworthy items in the report include:

• Utah's international exports in 2005 grew to $6.1 billion, a 28 percent rise from $4.7 billion in 2004, making the state the sixth fastest in export growth. Utah's top five exports were primary metals, computers and electronics, minerals, transportation equipment and chemicals.

• Utah's median household income from 2002-04 averaged $50,614, representing 113.8 percent of the national average of $44,473. But Utah's average annual pay of $32,171 per worker in 2004 was 81.7 percent of the national average.

• The number of married couples, with or without children, declined from 69 percent in 1980 to 65 percent in 1990 and 63 percent in 2004.

• Salt Lake City was the largest city in the state in 2004. However, Herriman led the way in population growth among the state's largest cities, increasing 38.5 percent from 2003 to 2004.

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E-mail: danderton@desnews.com