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Jobless rate dips a bit in Utah to 3.6%

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Utah's unemployment rate dipped three-tenths of a point in June to 3.6 percent, a drop that was unexpected but welcomed by the Utah Department of Workforce Services, coming as it did on the heels of repeated increases this year.

The decline placed Utah unemployment nearly a full point below the U.S. average.

The jobless rate in Utah climbed rapidly from January through April before leveling off in May and then declining in June, the department reported Friday.

"The (June) drop is a surprise but fortunately a pleasant one," said Ken Jensen, senior economist for the department.

Conversely, the national unemployment rate rose one-tenth of a point to 4.5 percent in June. That was the same percentage as in April, which was the highest since March 1998. The U.S. economy lost 114,000 jobs last month after adding 8,000 positions a month earlier and losing 165,000 in April.

In Utah, some 40,700 people were unemployed, a 14 percent increase from June 2000, when the jobless rate was 3.2 percent.

Jensen said the state's other primary indicator of current market conditions, the year-over rate of increase in the number of nonfarm jobs, has slowed from last year's pace, reflecting the relative stability of Utah's economy.

That rate is currently 2.1 percent, compared to 2.5 percent for all of last year.

But 2.1 percent is still much faster growth than the U.S. average, in which nonfarm jobs have grown at a lackluster 0.3 percent over the past 12 months, a 2 percent drop since the spring of 2000 and its lowest level in nine years.

Over the past 12 months, Utah's 66,000 employers have created about 22,400 net new nonfarm jobs, with the private sector responsible for 16,800 of them (up 1.9 percent) and government creating the remaining 5,600 (up 3.0 percent).

Construction jobs have been the main catalyst for Utah's ultra-low unemployment rate in recent years, but that sector stopped growing last summer after 11 consecutive years of often-rapid expansion, Jensen said. Since then, job losses in the category have increased, but not dramatically so.

Construction employment was down 1,600 jobs (2.1 percent) in June from a year ago, which is not a big loss considering the massive I-15 reconstruction project is all but completed. Strong residential construction and what Jensen terms "adequate" commercial and infrastructure projects are, so far, holding off a major downturn in local construction.

Services continues to be the fastest-growing category with 29 percent of the jobs. Over the past 12 months, some 12,300 new service jobs have been added, making it the primary factor in the state's economic strength.

Computer services expanded by 4,500 new jobs (up 14 percent), but both lodging and auto repair are growing by less than 2 percent.

E-MAIL: max@desnews.com