Utah small-business index improves in April

SALT LAKE CITY — A monthly gauge of Utah's economy rose in April, boosted by improved national conditions.

The Zions Bank Small Business Index for April, released Tuesday, was 97.8, up from 95.9 in March.

The index measures business conditions from the viewpoint of the Utah small-business owner or manager. It uses 100.0 for calendar year 1997 as its base, with a higher figure associated with more favorable business conditions for Utah's small businesses.

The national economy, a component of the Utah index, had a third consecutive quarter of growth in the first three months of this year, with a 3.2 percent inflation-adjusted annual growth rate. And U.S. job gains during April were the highest in four years.

"Perhaps the most favorable nugget of data was stronger performance by the consumer," Jeff Thredgold, president of Thredgold Economic Associates and economic consultant to Zions Bank, said in a prepared statement issued with the index release. "Consumer spending — 70 percent of the American economy — rose at a 3.6 percent real annual rate, the strongest performance in three years. Such spending rose at a modest 1.6 percent real annual rate during 2009's final quarter.

"Consumers in general have felt better in recent months about their own prospects for the future, tied to greater job availability, a rising stock market and more signs that the worst recession in our lifetimes is behind us. Still, a painful unemployment rate of 9.9 percent and 15 million people currently unemployed clearly limits the consumer spending upside."

Utah's unemployment rate, the most heavily weighted component of the Zions index, was 7.2 percent in March, the most recent month for which a figure was available. That compares with 7.1 percent in February and 5.2 percent in March 2009.

Total Utah employment fell an estimated 22,500 jobs, or 1.9 percent, during the past year. The Utah economy had lost 27,800 jobs during the prior 12-month period.

A higher Utah unemployment rate is a positive contributor to the Utah index, as it implies increased access to Utah labor. Recently, job losses have had a negative effect on the index because of the resulting loss of income creation and softer retail spending, Tuesday's report said.

e-mail: bwallace@desnews.com