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Utah’s economy on a ‘Road to Recovery,’ but plenty of pain remains, economist notes

Construction crews work on the 95 State at City Creek office tower in Salt Lake City on Monday, Sept. 21, 2020. The Salt Lake Chamber’s Roadmap to Recovery Coalition and Kem C. Gardner Policy Institute have released a new economic tool for Utah’s business community. The Road to Recovery Dashboard will track the state’s path to a full and complete economic recovery from the COVID-19 recession. The dashboard will be updated monthly to provide essential insights, track 10 timely and leading measures, and share salient indicators since the start of the pandemic.
Construction crews work on the 95 State at City Creek office tower in Salt Lake City on Monday, Sept. 21, 2020. The Salt Lake Chamber’s Roadmap to Recovery Coalition and Kem C. Gardner Policy Institute have released a new economic tool for Utah’s business community. The Road to Recovery dashboard will track the state’s path to a full and complete economic recovery from the COVID-19 recession. The dashboard will be updated monthly to provide essential insights, track 10 timely and leading measures, and share salient indicators since the start of the pandemic.
Steve Griffin, Deseret News

SALT LAKE CITY — A new online tool from the Salt Lake Chamber is aiming to help business owners stay current on Utah’s relative economic health as COVID-19 continues to wreak havoc on residents’ physical well-being.

The Chamber’s Road to Recovery dashboard collects some of the state’s leading economic indicators which, while among the highest-performing in the nation on many fronts, are still showing areas of commercial activity that are in extremely rough shape.

In its September debut, data on the dashboard reflects a handful of positive trends, including a near nation-leading 4.1% unemployment rate, taxable retail sales volumes that are well ahead of 2019 levels and unemployment claims that have been heading back toward pre-pandemic levels since an early May peak. Also, the Utah construction industry is booming with jobs in that sector up some 7% over 2019.

But other statistics reflect a bleaker side to the state’s fiscal health just over six months since the first case of COVID-19 appeared in Utah.

Jobs in the leisure/hospitality industry are down almost 17% since a year ago. Unemployment claims, while significantly reduced since this spring, are still north of 35,000 and about four times the pre-COVID-19 rates. The state’s powerful travel and tourism industry, one that accounts for 1 in every 11 Utah jobs, has been decimated and isn’t expected to recover for years. And local retail and service industry businesses without their own fiscal resources could be facing the hardest chapter yet as federal help has run dry and Congress has stalled on efforts to re-up emergency funding options.

At a Monday virtual press event for the new online tool, Natalie Gochnour, chief economist for the Salt Lake Chamber and director of the University of Utah’s Kem C. Gardner Policy Institute, called the recessionary impacts of COVID-19 a standout in the nation’s history of economic downturns.

“I have had eight recessions during my lifetime,” Gochnour said. “The COVID-19 recession is the most severe ... in terms of the biggest and fastest drop.”

Salt Lake Chamber President/CEO Derek Miller said the dashboard data, which will be updated regularly, is provided to help business owners make informed decisions on strategies to navigate ongoing fallout from COVID-19.

“Salt Lake Chamber’s primary objective with the new Roadmap to Recovery is to empower the private sector to create jobs and opportunity for individuals and families throughout Utah,” Miller said in a statement. “In that effort, we are just beginning. We need to see beyond the horizon to view opportunities as they are manifest, so our businesses can make decisions accordingly.

“While the effects of COVID-19 will be felt for years to come, and we are concerned by the current increases in the number of Utahns testing positive with the virus, from an economic perspective we know that in Utah we have a solid foundation upon which to rebuild.”

Downtown Alliance Executive Director Dee Brewer said Salt Lake City’s downtown has been hit with a trifecta of losses thanks to restrictions brought on by the novel coronavirus. Brewer noted the city’s commercial core, and state economic epicenter, is driven by three major groups of customers: those who commute to work downtown; those who travel to Salt Lake City to attend conventions and meetings; and those who visit the city for sports and cultural events.

The tens of thousands of daily downtown commuters? Brewer said that volume, as of last week, was around 23% of its usual. The 700,000 who annually attend conventions and gatherings in Salt Lake City? Essentially evaporated amid the pandemic with occupancy rates in the “convention core” just 30% of last year’s. Jazz games, ballet, opera, theater and cinema engagements? Once at a standstill and now, most venues, if open at all, offering very limited programming.

Still, even though downtown businesses may be well short of thriving, Brewer noted the many ways in which the capital city’s commercial sector is finding ways to survive.

Downtown Alliance data shows 135 downtown restaurants and bars are back to offering take-out and/or dine-in service, an increase of 69% since May 12 when just 75 restaurants were open for limited service. And 90% of downtown retail stores are open with operators reporting that traffic continues to grow each week. While customer numbers are down over last year, the alliance reports some stores are seeing sales closer to last year’s performance.

“There are fewer shoppers but a high percentage of those shoppers are purchasing products,” one downtown merchant said.

Brewer said the Downtown Farmer’s Market, while operating on an abbreviated basis, has proven a boon for local farmers and specialty item merchants.

“We made the market a little bit smaller and re-organized it,” Brewer said. “But the farmers who are participating are doing better than ever.”

Customers dine outside during the Downtown Alliance Open Streets event in Salt Lake City last Friday, Sept. 18. The event closes a section of Main Street to automobiles and features free outdoor music and entertainment along with expanded retail and dining experiences.
Downtown Alliance

Brewer’s group also launched a downtown Open Streets event last weekend that will be running through Oct. 10. Open Streets closes down a section of Main Street to automobiles from 6 p.m. to 10 p.m. each Thursday-Saturday, turning part of the street into an open market for merchants, restaurants and entertainment.

Brewer said the event’s debut weekend featured different musical acts every half-block and restaurants and retailers expanding their venues to the outdoors. He said they were still gathering information but reports from downtown businesses suggest the effort was a hit.

“It appears to have been a huge success,” Brewer said. “The Salt Lake Arts Council brought in some of their Living Traditions performers to Exchange Place, we had buskers performing up and down Main Street.

“One restaurant reported their sales were up 30% ... and we’re hoping to build momentum over the next three weekends.”