Nearly one in five Utahns suffered severe financial losses in 2010, underscoring a high level of insecurity in the state, even though the economy is slowly improving, according to a Rockefeller Foundation report released Friday.
The foundation said an estimated 379,000 residents nearly 14 percent of Utah's population saw their "available household income" fall by at least 25 percent from 2009 to 2010 and didn't have a financial safety net adequate to replace the lost income.
Available household income is what's left after paying for medical care and servicing debt.
Bad as Utah's situation was, 20 other states were worse off, with Mississippi, Arkansas, Alabama, Florida and Georgia having the highest levels of economic insecurity. Nationally, the average level of economic insecurity was 20.2 percent, compared to Utah's 19.3 percent.
Still, said Jacob Hacker, a Yale University professor who co-wrote the report, "while Utah experienced somewhat lower levels of insecurity than the country as a whole, that does not mean it has done well."
"Even after the official end of the recession, one in five residents experienced large economic losses in 2010, and economic insecurity is substantially greater in Utah today than it was a generation ago," Hacker said in a statement.
The foundation developed an index of economic security for the U.S. and Utah using the federal government's Current Population Survey, which the U.S. Census Bureau uses to calculate poverty rates. The government survey followed individual Utahns for two years. The results allowed the foundation to determine the number of Utahns whose incomes dropped at least 25 percent.
The survey tracked the level of large economic losses endured by Utahns going back to 1986. On average, insecurity in Utah rose from 13.7 percent of the population to the latest 19.3 percent measurement.
In the 26 years since 1986, the level of insecurity among Utahns has cycled up and down. Peak levels occurred during the 1990-91, 2001-02 and 2007-09 recessions. However, each crest was higher than the previous crest, and each trough was deeper than the previous trough. The pattern suggests that Utahns' sense of security has steadily worsened over time.
Jim Wood, who directs the Bureau of Economic and Business Research at the University of Utah, said some of the worst effects of the Great Recession on Utah occurred in 2009, so he's not surprised that nearly 380,000 Utahns saw their incomes collapse.
In the run-up to the recession, the combination of soaring home values and record low unemployment encouraged many Utahns to borrow heavily against their home equity and increase their credit-card debt, Wood said. When the housing bubble popped, values plunged as much as 30 percent along the Wasatch Front and in southeastern Utah. Rising unemployment followed. Three of every four jobs lost during the recession were eliminated in 2009, he said.
"We lost over 60,000 jobs in a single year, which was over 6 percent of our labor force. That's a huge hit, in terms of income," Wood said.
Utah's economy is recovering faster than the wider U.S. economy. Even so, Utah has shown some weakness in recent months. The unemployment rate has been rising since March, while the pace of job growth has been trending downward since December.
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