Jobless rate, job growth both rise

Utah's unemployment rate inched higher in May to 4.6 percent, but the state saw encouraging job growth in key industries, the Utah Department of Workforce Services reported Tuesday.

The seasonally adjusted unemployment rate for May was a slight increase from April's revised rate of 4.4 percent, the department reported. About 55,000 Utahns were unemployed last month.

Total employment, the year-over change in the number of jobs, was unchanged at 1.5 percent last month.

"I'm encouraged by the employment growth in Utah," said Raylene Ireland, DWS executive director, in a prepared statement. "We would like to see a higher rate of growth, but I'm optimistic that we will continue to climb toward those levels as this year progresses."

Mark Knold, senior economist with the department, wrote in the May report that "employment gains of 1.5 percent in May translate to an increase of 16,300 jobs over May of 2003. If this number was seasonally adjusted, it would place Utah's employment at just under 2,000 jobs shy of the previous employment peak reached in January 2001. We're that close to regaining the employment count lost during the recent recession."

All but two sectors reported job gains last month, according to the DWS report: financial services and information. The business and professional services sector led May's gains, adding 5,000 jobs. Education and health, and trade, transportation and utilities added 3,600 and 3,500 jobs, respectively.

"I'm encouraged by the areas where the growth is occurring," Knold told the Deseret Morning News. "They are largely knowledge-based, higher-paying, foundational jobs in the economy. And the spending these people do lifts the rest of the boats up, so to speak."

Utah's unemployment rate remained well below the national rate, reported earlier this month. The U.S. Labor Department found that the national economy added 248,000 jobs in May. The unemployment rate held steady at 5.6 percent.

Barring unforeseen setbacks, Knold said he expects Utah will continue to add jobs throughout 2004.

"I'm looking for the employment numbers to climb higher in the next few months, approaching 2 percent growth," he said. "I think the percentages are well above 50 percent that that will happen. It's not guaranteed, but the chances are looking good."

In particular, Knold said he is interested in whether energy prices will impact economic growth.

"Most pundits and economists don't think it will, that there's enough momentum behind it," Knold said. "They're probably right. Playing the percentages, it looks like we should be able to weather the energy price rise, as long as it doesn't get up another 20 cents to 30 cents per gallon. I do think we've seen the peak here, barring any terrorist attacks."

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E-mail: jnii@desnews.com