SALT LAKE CITY — Utah consumers continue to express confidence in the state's economic fortunes, based primarily on the robust Utah employment market.
The Zions Bank Utah Consumer Attitude Index increased 0.8 points in August to register at 115. Consumer confidence in the Beehive State has remained above 110 since June 2016 — indicating that Utahns are still very upbeat about current economic conditions, as well as optimistic about the future. The overall index registered 3.5 points higher than its level at the same time last year.
In comparison, the national Consumer Confidence Index rose 2.9 points to register at 122.9 this month — 21.8 points higher than the same period in 2016.
Consumer attitudes remain high within Utah, largely due to the state’s robust job market, which has been fueled by expansion within the technology and housing sectors, explained Chad Berbert, principal with the Cicero Group. However, many residents may be noticing that the cost of living within the Beehive State is rising, a possible byproduct of economic expansion, he said.
"Given how strong our job market is, we've seen strong net in-migration from out of the state into Utah over the last four to five years," he said. "It's been a great benefit to Utah with people coming here for jobs and adding to the economy."
He noted that while the economy is strong and growing, one of the residual impacts has been a hike in housing prices prompted by increasing demand for rental units and home ownership.
"(The new residents are) driving some of the growth the state is seeing, but it is also contributing to some of the increased demand in housing and the price increases (in that market)," Berbert noted. Housing prices have climbed significantly over the past 12 months, he said.
According to U.S News, Utah’s economy ranks 29th in total affordability, a calculation based on cost of living and housing costs, he said. Housing prices in the Beehive State have increased by more than 10 percent since June 2016. Although increases in housing prices may be leading to higher costs within the state, there is an economic silver lining to the growth, Berbert explained,
Because Utah still has large amounts of land to develop housing units needed in the years to come, the state is in a better position to accommodate the expected population hike and subsequent increased housing demand, he said. While many Utahns have prospered from growth in the housing market, some residents are also being impacted by the increasing cost of living.
In the most recent month report, the Zions Bank Wasatch Front Consumer Price Index showed a 3.4 percent year-over-year increase in cost of living for residents. The index survey also showed that despite the recent rise in statewide prices, consumers are confident that the job market will continue to expand, providing higher levels of household income in the future. Fifty-six percent of respondents indicated they believe jobs are plentiful in the state — up 7 percent from the same time last year.
“Consumer attitudes remain high within the state despite the moderate price increases that we have witnessed in recent months,” said Randy Shumway, chairman and partner of Cicero Group. “As long as the Utah job market continues its current rate of expansion, and I see every indication that it will, there is no reason why consumers shouldn’t remain optimistic about the future of the statewide economy.”
The overall consumer attitude index is based on a representative sample of 500 Utah households surveyed monthly by Cicero Group — with a 95 percent confidence level with a variance of plus or minus 4.38 percent. The results are compared to both Utah data and national data from previous months to identify key statewide consumer sentiment trends.