Employment growth in Utah rose 3.6 percent from the third quarter of 2004 to the same period in 2005, the fourth-highest rate of job growth nationwide, the Federal Deposit Insurance Corp. (FDIC) noted Tuesday in its state profile report. The report also noted that Utah's job growth should exceed the national average through at least the end of the year.

But the FDIC also noted that the state's weekly wage from the first quarter of 2004 to the first quarter of 2005 - the most current data available from the federal government - increased 1.3 percent, well below the national average of 2.2 percent during the same time period.

"It's not all bad news," said Catherine Phillips-Olsen, a San Francisco regional FDIC manager. "The nice thing about Utah is that the housing is still affordable."

Plus, she said, unlike states such as Nevada, which are adding a significant number of low-paying jobs, Utah is adding a significant share of moderate-paying jobs and is set to add jobs in a number of higher-paying industries, as well.

Mark Knold, Utah Department of Workforce Services economist, said he believes the FDIC report underestimates Utah's wage growth.

He said wage increases in recent months probably have been greater than or comparable with the national average. In the third quarter of 2005, for example, average wage growth in Utah was 6.4 percent, compared with the same period in 2004, he said. A ranking of all states and a national average for that time period is not yet available.

"I don't think we are out of line at all with wage growth right now," he said, noting that Utah has had significant jobs gains in higher-paying positions.

Salt Lake City economist and Zions Bank consultant Jeff Thredgold also doesn't believe Utah's wage growth in this time of employment growth trails the national rate.

Thredgold said Utah would not be having such strong retail sales and housing sales or such a strong surge in tax revenues if wages were increasing only modestly. Utah's tight labor market - which has caused some shortages of labor in some industries - also is driving up wages, he said.

"We might have been lagging in wage growth in 2002 and 2003, but not now," he said. "We are having both strong job growth and income growth."

Wells Fargo economist Kelly Matthews agrees. He said he doesn't think wage growth of 1.3 percent from March 2004 to March 2005 is right, either.

"I don't think Utah has had wage growth below 2.5 percent any time in the last couple of years," he said.

It is estimated that cost of living increases over that time period were 2 percent to 3 percent.

lesley@sltrib.com

More FDIC report highlights

l Office vacancies are declining as demand for space has increased.

l Apartment vacancies are on the decline, and rents are on the rise, although a jump in multifamily construction could reverse that trend.

l Hotel occupancy rates in Salt Lake City reached nearly 64 percent in the third quarter of 2005, the highest since 1999.

l Bank earnings are up, problem loan ratios are down and loan growth is on the rise.