Job growth in Utah increased by only 0.9 percent in June, compared with a year earlier, and that growth is starting to flatten.
Mark Knold, chief economist for the Utah Department of Workforce Services, said job growth will likely be negative in the next three to four months. "It seems like we're going to go below zero," he said.
Job growth is the first measure that economists use to examine the economy. People spend less money if they lose their jobs and are unable to stimulate the economy, which can lead to more job losses.
Construction and financial-sector jobs are dwindling in Utah. The state lost 10,900 construction jobs and 500 financial-sector jobs from June 2007 to this past June. Other industries are growing, but at a slower rate than last year. Manufacturing grew a mere 0.7 percent from June 2007 to this past June.
Knold believes the local construction industry could lose another 11,000 jobs by this time next year, and that the overall job growth rate will be sluggish through 2009.
But the number of jobs lost in the construction industry hasn't been reflected in the state's unemployment rate of 3.2 percent, a figure that economists typically believe reflects a "maxed out, fully employed" economy, Knold said.In the past five to eight years, jobs in construction that used to be held by local workers are now held by immigrants. These days, when construction workers lose their jobs, many don't apply for unemployment. They may move to states where they can find work, or some may return to their home countries, Knold said.