Report says slow, steady recovery continuing for Utah, Mountain West

SALT LAKE CITY — The climate for business in the Mountain West chilled a bit in May, but a new study says the region's slow, steady recovery should continue as long as the economic problems in Europe don't.

The monthly Business Conditions Index, compiled by the Goss Institute for Economic Research for Utah, Colorado and Wyoming, is pointing to positive economic conditions in the near future. The index was 57.9 in May, down from 58.8 in April, but higher than the 55.9 reading in March and 55.8 in February.

The index used in the survey ranges from zero to 100, with a figure higher than 50 indicating an expansionary economy during the next three to six months. The institute obtains the information from a survey of the states' supply managers.

While the May employment index slipped in the region, it remains a solid 54.2, down from April's 54.8, the report said.

Ernie Goss, research director for the institute, wrote in an assessment of the figures released Tuesday that Utah has started adding back some of the more than 77,000 jobs lost since the beginning of the national recession. Goss wrote that he expects the state "to fully reclaim the lost jobs by January 2012."

The Business Conditions Index number for Utah alone rose to 59.4 in May, up from 58.9 in April and 55.9 in March.

A mitigating factor in the region's recovery could be the economic troubles in Europe. Most on the minds of suppliers last month, according to the survey, were the possible negative impacts on agriculture income and industries linked with agriculture.

"The financial turmoil in Europe is a threat to the economic expansion under way," Goss wrote. "It has increased the value of the dollar, which has made U.S. manufactured goods and agricultural products less competitive abroad."

He noted that nearly 37 percent of supply managers surveyed in May expected negative impacts on their businesses if the recent debt crisis in the European Union continues.

That said, Goss wrote that he believes the region's figure from the economic optimism index in May — 58.7, down from April's 63.8 — was a slip. He doesn't believe optimism in the Mountain West will be deterred six months from now.