Utah's economy is rebounding, but construction still is slow and out-migration is expected to continue in 1989, according to a report released Tuesday.

The report, an annual study released by the State Economic Coordinating Committee - composed of several state agencies and a senior executive of First Security Bank - said the state has created fewer jobs during the 1980s than any decade since the Depression-plagued 1930s. Much of Utah's future will be tied to international market forces and federal spending under President Bush.Still, Utahns are expected to have more jobs and earn more money in 1989. The population, despite a steady stream of people leaving for better work, is expected to grow.

Gov. Norm Bangerter was pleased with the report, saying it is much more encouraging than reports in recent years.

"We believe that we've weathered the storm well and are now on the rebound," he said. "There is much reason for optimism."

However, he cautioned, the state must continue to prepare for growth by aggressively working to attract new businesses. Earlier Tuesday, Bangerter spoke to a Park City convention of corporate leaders nationwide who are customers of Huntsman Chemical Co., owned by Utah industrialist Jon Huntsman. He urged the leaders to move their facilities to Utah.

Responding to the economic report, Bangerter said the state should follow the example Japan has set since World War II. The state should concentrate on building a strong, industrious and well-educated work force that will attract industry.

"For those who say we don't want growth, we've already decided we're going to have growth," Bangerter said, referring to the state's high birth rate. "The children are here. We will either grow or be forced to send our children elsewhere for jobs."

The report was generally optimistic about the state's economy, citing a "major turnaround" in 1988, fueled by increases in service and manufacturing jobs. A long list of local corporations expanded during the year. Utah now is home to about 267 technology firms and is an "aspiring high-tech mecca."

The state's energy and minerals industries also grew significantly in 1988, the report said. Although the state's economy has done far worse in the 1980s than in previous decades, Utah has fared better than many neighboring states, ranking third among eight Mountain West states in non-agricultural jobs created from 1982 to 1987.

However, the report contained bad news for the construction industry. Although final figures were not available, the report said residential construction is expected to have declined 24.7 percent in 1988, making a two-year total decline of 60 percent.

"In general, vacancy rates in Salt Lake County remain sufficiently high enough to thwart any attempt to raise rental rates," the report said

A weak demand for office space and changes in tax laws contributed to a sharp decline in commercial construction also, the report said.

Bangerter, a former developer, said he has seen signs that the construction industry may soon rebound. "But I think it (1989) is still not going to be a boom year."

He urged state lawmakers to approve his $50 million bonding recommendation to build state highways and water projects. He said the state's education system is the key to prosperity in the 1990s.

"If Utah is to grow and prosper, I believe it must look to its human resources," he said. "If we can combine high quality education and our work force we will be attractive.">