The state added 11,500 jobs in the year that ended in June for an employment growth rate of 0.9 percent, the Utah Department of Workforce Services said Tuesday in its monthly jobs report.

That's down from 1.3 percent in the year that ended in May and down significantly from a peak of 5.4 percent in the year that ended in June 2006, when the state's economy added 54,000 jobs.

By comparison, the U.S. rate is a negative 0.1 percent. But in another couple of months, the state could be in the situation of not creating any jobs year over year, said Mark Knold, chief economist with the Utah Department of Workforce Services.

"You just have this one industry having a glaringly bad time," he said.

Existing home sales are down significantly from last year in most areas along the Wasatch Front. And the number of building permits taken out by builders is at a two-decade low.

Builders took out permits for the construction of 354 homes last month, down from 1,027 in June 2007 and 1,728 in the same month in 2006, according to Construction Monitor, a service that tracks home-building activity throughout the West.

The real-estate downturn - which began last summer in Utah and two years earlier in most other states - had its origins in the nation's subprime-lending debacle, in which scores of people with less than good credit, low incomes and/or high-debt loans got home loans they could ill afford to repay. Many of these loans are ending in foreclosure.

Today, tighter lending standards put in place after the crisis have made it harder for potential buyers to qualify for loans. Years of home-price run-ups also have made it difficult for many Utah families to afford to buy.

With fewer homes being sold and built, many Utahns have lost jobs related to residential real estate. Workers at a variety of companies are affected, including real-estate brokerages, title companies, furniture retailers and home-improvement companies that sell related goods and services.

On the unemployment side, Utah's rate in June was 3.2 percent, which translates to about 44,800 Utahns who were looking for work. That's up from 36,400 people in June 2007, when unemployment was 2.7 percent, but is still well below the national jobless rate, at 5.5 percent.

All job sectors in Utah - except construction and financial activities - are adding jobs. But Knold said that could change. "There's a danger of this whole thing affecting other industries."

Even commercial real estate, which had been quite robust, is slowing down. The good news is that The Church of Jesus Christ of Latter-day Saints is helping prop up that market by pumping millions of dollars each of the next several years into its massive City Creek Center project, which includes new retail, office and residential space in downtown Salt Lake City.

Knold said that gasoline prices also are weighing heavily on the state and national economies.

On Tuesday, the average cost of a gallon of unleaded gasoline in Utah hit yet another record, at $4.19 per gallon. Nationally, gas prices also hit a record, at $4.11 per gallon, travel services agency AAA Utah reported.

"Gas prices are another issue," Knold said. "If you could bring gasoline prices down a bit, it would pump a great deal of confidence back into this economy."

lesley@sltrib.com