This State’s Unemployment Rate Is Only 4.5%
Economists usually count a jobless rate of 5% as “full employment.” A certain number of people who are out of jobs find new ones very quickly. They often are not captured in the official numbers from the U.S. Bureau of Labor Statistics (BLS), which reports the data. That made the 3.5% unemployment number through much of last year all the more extraordinary. As unemployment has soared in the United States due to the COVID-19 crisis, two states have had a jobless rate of under the 5% number. The lowest of these in July was Utah at 4.5%, against the national rate of 10.2%. Utah essentially has full employment in a period in which the country is in the midst of the worst job crisis in nearly a century.
The BLS has released its “State Employment and Unemployment July 2020” report. Utah was followed by Nebraska at 4.8% and Idaho at 5.0%. At the other end of the spectrum, Massachusetts had a rate of 16.1%, just below the New York number of 15.9%.
The BLS does not give reasons for the state unemployment rates. A look at the composition of the jobs in Utah has a few clues about why its rate is so low.
One industry in Utah is in trouble, which means several others have to be very strong for the state to post such a low figure. Part of the Utah economy relies on tourism, which has been undercut by the sharp drop in travel due to the pandemic. The two other largest industries in Utah are agriculture and mining, each of which has weathered the jobs catastrophe fairly well.
Utah’s largest employers are also in sectors that have not suffered sharp layoffs. Of Utah’s seven largest employers, five are health care systems or companies. University Healthcare is the largest at 10,000, followed University of Utah Health at 7,866. Of the top 25 employers in the state, over half are in the health industry.
Other large employers also have not been affected much, if at all, by the spread of COVID-19. These include Walmart, which has thrived over the past several months, as shown by its recent earnings. Hill Air Force Base is also a large employer. So are several school systems and universities.
Unemployment in the United States will remain high for months, if not longer. Utah is fortunate to have a job market dominated by industries that are likely to continue to thrive.
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