Utah sees modest economic gains

SALT LAKE CITY — The national economy still looks uncertain, but there have been modest gains in Utah, based on the latest small business index released by Zions Bank on Tuesday.

"The Utah recession is over," said Jeff Thredgold, economic consultant to Zions Bank. "The last official data from the Department of Workforce Services shows the Utah economy adding 900 jobs in the last 12 months. That's not a great number, but everything is relative. Twelve months ago, the state was down more than 70,000 jobs in the preceding 12-month period."

The Zions Bank Small Business Index was 105.8 in June 2010, which is up from a revised 103.4 in May 2010. The index measures business conditions for small Utah companies, with a ranking of 100 from 1997 as its base.

"In the small-business index, the Utah data continues to get better each month, and that's a positive development," Thredgold said. "In terms of Utah, better days are clearly ahead of us, based on where we've been the last 18 months. It's not pretty, but it's getting better."

On the positive end, interest rates are extraordinary low, which can be useful for small businesses that need to borrow, he said. There also is a plentiful supply of labor, since many people are unemployed.

But there are downsides — credit availability is tight, and when people are out of work, they spend less, which particularly hurts the retail sector.

"Like many states, Utah had its worst recession since the Great Depression," Thredgold said. "Utah is one of the states that is coming out of the recession: The numbers continue to get modestly better and will in coming months. But it has been an enormous challenge for businesses of all types in the past two to three years."

Thredgold sees the Utah situation in the middle of 2010 as "in transition to growth — the growth is not going to be impressive, but it will be positive in the second half of the year."

The national economy is a different story, one Thredgold terms "a mixed bag."

"The U.S. economy is growing in fits and starts," he said.

There is more talk of a potential "double-dip," or return, to recession.

"I don't think we're going to get that, but indications are the national economy is not as robust as the expectations were two to three months ago," he said.

Thredgold predicts the U.S. economy will continue to grow "at a modest rate over the balance of the year."

e-mail: lindat@desnews.com