High technology and heavy industry have helped push Utah out of the economic doldrums, providing hope that the drain of outward migration will end soon.

Bolstered by creation of more than 25,000 new jobs during the past 12 months, the economy is moving at a quickened pace, generating a $37 million projected revenue surplus for state government.The surplus is the product of a $32 million boost in projected income tax collections and a $5 million increase in sales tax revenues. It comes in addition to $19 million set aside by the Legislature at the end of the 1989 general session.

Lawmakers wanted to use the $19 million for a tax reduction but were unable to agree on which tax to cut. Since then, about $5 million of the money has been set aside for nuclear fusion research at the University of Utah.

The revival appears to mark the end of an economic slide that began in the early 1980s and forced severe austerity on state agencies.

Barring a national recession, prospects are good that the economy will remain healthy, although it probably will not continue to grow so rapidly, economists say.

"The economy's doing quite a bit better," said Jeff Thredgold, vice president and economic forecaster for Key Bank of Utah.

"Just talking to people around town, the mood certainly is better than 18 months ago. There was a doom-and-gloom situation. Now you hear the complaint that they can't find people to fill jobs," Thredgold said. "I think the majority of out-migration is over with."

Outward migration reached a peak in fiscal years 1986-87 and 1987-88, with a net loss of more than 11,000 people each year, according to a December 1988 report by the U.'s Bureau of Economic and Business Research.

"Not many years ago we were having in-migration, but because of the economy, that turned around," said Ken Jensen, an economist with the Department of Employment Security and a member of the State Population Estimates Committee.

A key part of the resurgence has been the continued prosperity of two major heavy industries, BP Minerals, formerly Kennecott, and Geneva Steel of Utah. Together, they have contributed about 4,000 jobs that pay far better than wages offered in the service sector, said Thredgold.

Although both reopened more than a year ago following closures, it has only been in the past 12 months that the full impact has been felt, Thredgold said.

Equally important has been the steady growth of high-technology industries in Utah County. The success of larger firms, such as WordPerfect and Novell, has been supplemented by healthy growth for a number of smaller firms that have provided well-paying jobs.

Kelly Matthews, chief economist for First Security Bank, said small businesses are hiring more workers, contributing to a 4.3 percent unemployment rate - one of the lowest in the nation.

"There are a lot of companies that are adding a few employees because they find it profitable to make things here and export them, either to other states or out of the country," Matthews said. "Instead of cutting one or two employees, they're adding one or two."

The result was the creation of 25,000 new jobs during the past 12 months and a 7.5 percent increase in personal income, said Matthews. Retail sales have improved at an even quicker pace, with the state Tax Commission reporting 8 percent to 9 percent growth in the first few weeks of 1989, he said.

Residential and commercial construction, in a severe slump for several years, are among the few sectors that have not shared in the prosperity. However, Matthews said the housing market should stabilize this year.

Finally, the state has enjoyed increased tourism. A study by the Utah Foundation, a private, non-profit research organization, concludes that motel room rentals have risen steadily during the past five years, increasing by nearly 24,000 in 1988 to a statewide total of 220,688.

Dale Hatch, director of the State Budget Office, said Utah's rejuvenating economy contrasts sharply with eastern states such as Massachusetts and New York, where economies have turned downward.

But while state government has been a beneficiary of the revival, a recent U.S. Supreme Court decision could prevent the full surplus from being spent on state projects.

Ruling on a Michigan case, the court said that state governments cannot exempt retired state employees from state income tax while imposing the tax on federal retirees

Gov. Norm Bangerter and the Legislature are considering several options to comply with the ruling. Among them is a plan to simply exempt all retirees from the income tax, a move that would cost an estimated $40 million to $50 million per year.

"There is no question it will eat some of the revenue up," said Hatch. "It would have to come from this kind of source. That's an issue but there are a lot of options."