Economist: Good times for Utah, but dangers lurk
There isn't a state in better shape than Utah today, but its future is threatened by diminishing educational attainments and battles in Washington over the U.S. fiscal crisis, a top economist said Thursday.
"I can stand before you as an economist representing the University of Utah and the largest business organization [in the state of Utah], and I can tell you that we now have the best economy in the country," Natalie Gochnour, associate dean at the university's David Eccles School of Business and chief economist at the Salt Lake Chamber.
Speaking to several hundred people at Gov. Gary Herbert's annual economic summit, Gochnour ticked off numerous examples that she said showed the state economy had bounced back from the Great Recession. Job growth and unemployment rates are better than almost anywhere in the U.S. Personal incomes are growing rapidly, and migration, retail sales, exports and construction activity all are strong, she said.
But, Gochnour added this warning:
"I also live in a country that has economic leadership in Washington, D.C., that is letting us down. While in Utah I can talk about economic leadership, in Washington I can only criticize the economic leadership that is occurring. I picked the word 'bumbling,' " she said.
"We have in our control the ability to take purposeful actions to control our fiscal future, and for whatever reason, we are choosing to fight" with one another, Gochnour said.
Herbert spoke at length during the lunch hour about the state's economy, its robust technology sector and its lean government, which he said is smaller today than it was in 2001, even though 500,000 more people live in Utah.
"Here in Utah, we have the people, we have the opportunity and the passion to continue to be a global leader in economic activity," Herbert tweeted later.
But Gochnour said several worrying signs suggest Utah's educational system is in danger of falling behind and ultimately weakening the economy. Graduation rates at the U. and other colleges and universities are in decline. The percentage of people age 25 to 34 with bachelor's degrees is now lower than that for people 35 to 44 years old.
"This is unacceptable. In an information economy, education is a key to your family's future. For us to have fewer 25 to 34 year-olds as a percentage who have taken a bachelor's degree than the people ahead of them [is] unacceptable," Gochnour said.
Math scores also have slipped. In 1992, Utah eighth-graders were No. 10 in the country. In 2011, they had dropped to 26th from the top 20 percent to the bottom half of all states, a warning sign that should be saying something to elected officials, she said.
Citing a Utah Foundation study, Gochnour said the reading skills of Utah fourth-graders ranked last among a number of states with similar characteristics, after adjusting for race, ethnicity, socio-economic backgrounds and educational levels of parents.
Compared with all 50 states, "we are about average, but we're dead last when you compare to [states] we should do well with," she said.
The Legislature took a step this year to confront the problem, the economist said. Lawmakers created a 14-member education task force to make recommendations on long-term policies for public and higher education.
"Education is getting the attention that it deserves. It's a major red flag for the state if we don't take care of it," Gochnour said.
Former President George Bush to speak in Salt Lake City in May
The two-term president will deliver the keynote speech at Zions Bank's trade and business conference on May 29, at the Salt Lake Marriott Downtown at City Creek hotel. The speech will not be open to the public or the media. Only invited guests can attend. Other parts of the conference will be open to the public.
Registration, cost and other conference information will be posted at http://www.zionbank.com/conference.
Economic, demographic projections for Utah in 2013
Employment expected to increase by 3.5 percent vs. 3.2 percent in 2012
Population should grow 1.7 percent vs 1.5 percent in 2012
Unemployment rate should average 5.4 percent vs. 5.7 percent in 2012
Home prices expected to rise 2.8 percent vs. 1.1 percent in 2012
Retail sales should rise 6.1 percent vs. 6.7 percent in 2012
Source: Governor's Office of Planning and Budget