Utah still in economic slump

Recent reports indicate a continuation of an economic slump for Utah, according to a Goss Institute for Economic Research index released Wednesday.

Utah's business conditions index revealed the overall index advanced in the month of June to 40.3 — well below growth-neutral, which is 50 — but up from May's 37.5 and April's record-low 32.7, the institute said.

Components of Utah's overall index for June were new orders at 45.4, production at 47.8, delivery lead time at 41.4, inventories at 28.8, and employment at 40.3.

In a prepared statement, director of the institute and Creighton University's Economic Forecasting Group, Ernie Goss, said Utah's unemployment will continue to rise.

Over the past year, Utah lost more than 13,000 manufacturing jobs. More than 7,000 Utah workers left the work force over the past three months, according to government employment data.

"As these workers see the economy pick up, they will once again enter the work force searching for a job and increasing the state's unemployment rate," Goss said. "I expect the state's unemployment rate to top out at 6.0 percent (seasonally adjusted) before the fourth quarter of this year."

The institute tracks the Mountain States region, which consists of Colorado, Wyoming and Utah. Goss said the overall index for June improved to a lackluster 41.4 from May's 38.9 and April's 37.8. The recent readings "point to negative growth, job losses and rising unemployment rates in the months ahead for the region."

Colorado lost more than 14,000 manufacturing jobs and the June business index slumped to 42.0 from May's 44.0, but was higher than April's 38.0, according to the institute report. On the other end of the spectrum, Wyoming lost more than 2,000 mining and natural resources jobs rather than seeing a decrease in manufacturing. For June, Wyoming's business index advanced to 47.1 from May's 41.5, according to institute reports.

The good news is the region may have already gone as low as it can for the year, Goss said.

"On a more positive note, readings over the past several months indicate that the region's leading economic indicator has bottomed out with the region's business conditions index likely to continue its upward trend in the months ahead," he said.

The Institute of Supply Management's national index posted a 44.8 — the best showing since last August, a month before the financial crisis erupted with force. The figure in June was up from 42.8 in May and marked the highest point for the index since August.

But economists were heartened by the upward trend in recent months: This is the second straight month that the index has been above 41.2. ISM analysts said this was consistent with an expansion for the overall economy even though manufacturing is still shrinking.

Contributing: Associated Press

E-mail: cneugebauer@desnews.com