By common economic measures Utah is experiencing economic prosperity that is the envy of the nation. But for the state with the largest portion of its population under 18 years old, one metric should be of great concern: the disappearing single-income household. When households can reliably depend on one income, they can more efficiently allocate time and talent to the care and nurturance of children. Apart from urging employers to make greater accommodations for dual income households, the only other practical antidote is to increase both the quality and quantity of educational attainment. Addresssing this issue has unique urgency for Utah.
Utah unemployment rates are among the lowest in the nation and job growth rates are among the highest. The housing market is strong and the state is running an admirable budget surplus. So what’s not to like about the Utah economy?
Buried in the positive economic numbers for Utah is a trend that is devastating to a number of Utah households that should be a concern for all Utahns over time.
Much has been said about the declining coal industry in Utah. The magnitude of this decline is stunning. In just one year between December 2014 and December 2015, over 20 percent of all jobs in the mining, quarrying and extraction industries in Utah disappeared. This rate of employment collapse is unusual in any industry. It is particularly significant for Utah because these are some of the highest-paying jobs in the state, with an average weekly wage of almost $1600. The result was a decline in statewide wages of nearly $200 million on an annualized basis. And for those who lost good-paying jobs, their former income levels are likely gone forever.
Why did this sharp decline in jobs and total wages go almost unnoticed at the state level? Because the state created so many jobs in other industries that the loss of these jobs was more than compensated for by increases elsewhere. For example, over the same period the accommodations and food-services industry (the lowest-wage industry sector in the state) created so many new jobs that even at a very low average weekly wage of $333 this industry managed to add over $200 million in wages on an annualized basis — slightly more than what was lost in the mining and extraction industry.
Coal is not the only industry that is struggling, and hospitality is not the only industry growing rapidly. Overall, the average wage in Utah has been rising. The construction and professional/financial services sectors are high-wage industries that are growing rapidly in Utah. In fact, during that same 12-month period, Utah private-industry wages increased by a remarkable $4.5 billion, translating into slightly more than a 9 percent increase year over year. These are the numbers that are the envy of so many other states.
However, as the mix of jobs changes over time, the jobs that can support Utah’s relatively large households on a single income are requiring more and more education. The good news is that there are plenty of less-skilled jobs for other household members to supplement household incomes. The bad news is that many of the new jobs in the state do not pay enough to support single-income households.
The current employment and wage trends are broad-based and not unique to Utah. However, since Utah has the youngest average age in the nation and one of the largest average household sizes, these trends are particularly challenging to many of its households.
Of course single-income households are not universally preferred. But looking toward the future, Utahns who want to enjoy a single-income household lifestyle may have only one practical course of action: increase their level of education attainment. In the meantime, employers and policy makers should look for ways to better accommodate families with two incomes and little spare time.
Gov. Gary Herbert's focus on improving the quality of education in Utah is not only good policy, it may be essential to fostering healthy families – a characteristic that uniquely distinguishes Utah from many other states in the country.