Utah’s low unemployment rate deceiving, experts say

Posted at 8:37 PM, Mar 16, 2015
and last updated 2015-03-16 22:37:05-04

SALT LAKE CITY -- Utah's economy is the envy of the nation in a number of ways, most notably with the diversity of industries employing its citizens and its low unemployment rate, a mere 3.4 percent -- the second best number in the nation.

But the Utah Food Bank is still in the midst of a spike of food insecurity, the term it employs to describe people who often don't know how they'll afford their next meal.

The explanation? Jim Yorgason, the President and CEO of the Food Bank, said in part it is under-employment.

"Congratulations to the state with a three and a half percent unemployment number, but it's a little deceptive because so many people are underemployed, working two maybe three part-time jobs, and at the end of the month it's just not enough and food is one of the first things to go," Yorgason said.

Underemployment is likely part of the explanation. Another part: workforce participation.

While Utah has a low unemployment rate, Utah has seen a bigger drop in workforce participation than most of the country.

The Federal Government's Bureau of Labor Statistics tracks a number called the employment to population ratio, showing the percentage of the working age population that is employed.

Utah had great workforce participation before the Great Recession. In 2007, 82.3 percent of Utahns between 25 and 54 years old participated in the workplace.

In 2014 that number is 78 percent.

That 4.3 percent drop puts Utah in the bottom half of states in terms of the drop in participation from pre- to post-recession.

The chief economist for the Utah Department of Workforce Services, Carrie Mayne, knows the numbers well and said they are understandable considering the depth of the economic downturn.

"It took us such a long time to reach the bottom of the Great Recession. It's really no surprise that it's taken us this long to recover," said Mayne, while pointing out that other numbers have rebounded.

That may sound worse than it actually is because Utah started with such high participation. Even after a big drop, Utah's participation is better than the national average at 76.2 percent.

What does this all mean?

In the big picture, there's still work to do, pun intended, and in the small picture there's still plenty of need for the canned foods you put on your doorstep for the Boy Scouts to pick up.