Economic Snapshot - January 2021
Economic growth slows as case counts grow
After seven months of growth, the labor market experienced a contraction in December. The U.S. lost 140,000 jobs last month, with most of the losses coming in the leisure and hospitality sector. The unemployment rate and labor force participation remained level at 6.7% and 61.7% respectively. All but one sector grew month over month, with trade, transportation, and utilities (+191,000); professional and business services (+161,000); and construction (+51,000) adding the most jobs. Leisure and hospitality (-498,000); government (-45,000); and education and hospitality (-31,000) sectors lost jobs month to month. Although the loss of jobs represents a step back in the economic recovery, the new round of federal economic stimulus and rollout of a vaccine provides optimism that job losses in December will be temporary.
Utah’s economy is within spitting distance of a full employment recovery. The Beehive State remains the second-closest state to recovering to its 2019 economic levels, with employment declining a little less than one-tenth of one percent over the last year. Unemployment increased in November, rising 0.2% to 4.3%. The increase may be related to the increasing labor force participation rate, which also rose 0.2%, registering at 68.1% in November. Utah lost 2,800 jobs over the past year, with the trade, transportation, and utilities (+10,700); construction (+5,200); and financial activities (+4,000) sectors gaining the most jobs. Leisure and hospitality (-19,300); professional and business services (-2,200); and information (-2,200) lost the most jobs year over year. Annual housing price growth continues to accelerate, rising from 9.9% in October to 11% in November.
For the second consecutive month, Idaho was the only state to report no job losses year over year, with employment growing 0.5% year over year. Gem State unemployment continues to improve, declining from 5% in October to 4.8% in November. The decline could be due to the change in Idaho labor force participation rate, which decreased significantly in November, dropping 0.7% to 64%. Idaho gained 5,100 jobs over the past year, with the trade, transportation and utilities (+6,600); manufacturing (+3,400); and financial activities (+3,300) sectors gaining the most jobs. Government (-5,200); education and health services (-4,000); and other services (-1,500) lost the most jobs year over year. In November, Idaho’s housing price growth registered at a 14-year high of 14.4%; once again, the highest rate in the nation.