Tight Utah labor market heading into 2023
Last month, Utah saw an increase of 2.6% in nonfarm payroll jobs, which translates to about 43,000 more jobs compared to last year.
Benjamin Crabb, regional economist for the Utah Department of Workforce Services, said despite Utah experiencing historically low unemployment in a tight labor market, he believes the state is well positioned going into 2023.
"The ratio of job openings to unemployed workers in the state is at historical highs," Crabb reported. "It's at about three job openings per worker right now. The national level is also elevated, but it's at about one-and-a-half openings per unemployed worker," said Crabb.
Crabb pointed out the high level of job openings is starting to trend down slightly as monetary conditions tighten at the federal level. He contended the most recent report is no cause for concern, and shows Utah's economy is still managing to expand despite current conditions.
Utah has also seen a significant flux of migration into the state. According to estimates from the University of Utah's Kem C. Gardner Policy Institute, the state added more than 70,000 people since the 2020 census.
Crabb outlined some of the sectors with the biggest year-over-year job gains were in construction, education and health services, trade, transportation and utilities, as well as hospitality. Professional business services and financial activities were the only sectors which saw contractions in the last 12 months.
"Real estate lending in particular has been hit, while over the last year, as the interest rates have risen," Crabb explained. "Mortgage rates have hit around 7%. You know, levels not seen for years."
Crabb noted the current surplus of Utah job openings could diminish if the country would slide into a recession, but added the job surplus would help protect the state before real job losses are seen.