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SALT LAKE CITY — Utah's economy remains strong, but intrinsically tied factors such as workforce shortages and housing affordability are looming challenges that require attention if the Beehive State wants to maintain its standing as the nation's best economy.
This and the economic relationship between rural and urban Utah were the themes of a discussion between economists, business leaders and politicians Tuesday morning at the Kem C. Gardner Policy Institute.
Jobs and housing
According to the Utah Department of Workforce Services' most recent job report, Utah has experienced year-over-year job growth of 2.1%, slightly higher than the national average of 1.9%.
While Utah's economy is projected to continue growing, it's doing so at a similar rate as the rest of the country. This decelerating growth represents a departure from the past two decades that saw Utah arguably performing better than any state in the nation.
"We're being constrained in our growth by the availability of labor. We're having challenges getting people here in the state to work, and I'm convinced housing is a central part of that. We're dealing with this shortage (and) very high prices," said Phil Dean, chief economist at the Kem C. Gardner Policy Institute.
A recent analysis from Bankrate.com found that Utah is one of 22 states where buyers need a six-figure household income to comfortably afford a typical median-priced home.
Still, the experts are optimistic about the ability of policymakers and business leaders alike to help quell some of the issues threatening the longevity and performance of economic development in Utah. Here's where they say it starts.
Urban and rural Utah working together
"Urban Utah needs rural Utah," said Rep. Carl Albrecht, R-Richfield. "But we (rural Utah) also need urban Utah. So it's a two-way street."
Albrecht said he envisions the Wasatch Front's growing population naturally "driving the economy south" as more remote workers migrate to the less-populated areas of the state to escape the hustle and bustle.
He also said that rural Utah provides two essential things to the state's more urban areas: power and agriculture.
A champion of both of those, Albrecht in the 2024 legislative session sponsored a livestock grazing amendments bill that changed grazing in the state from a permitted activity to a right. The bill was signed into law in March.
As far as energy goes, Utah's rural areas are rich in natural resources, from critical minerals to oil, coal, wind, solar and geothermal energy and more.
"I represent Beaver County. A lot of renewable energy there — wind, solar and now geothermal. Wind and solar are intermittent. Geothermal, 24/7, (and) we'll take all of that we can get," Albrecht said.
'Keep coal going'
Albrecht said a key takeaway from the last legislative session — noting it's one that some people "may not like" — is that "we're going to keep coal going."
It's that unification as a state where people here along the Wasatch Front do care about what happens in rural Utah, and rural Utah does care about what happens in the Wasatch Front.
–Phil Dean, Kem C. Gardner Policy Institute chief economist
"We passed a bill that would keep Rocky Mountain's coal plants going in Emery County for several more years than their original ... Integrated Resource Plan called for," Albrecht said. "We told Rocky Mountain Power, 'If you'll keep those coal plants running, we'll support you as a Legislature.'"
Passed during the 2024 legislative session, HB191 prevents the Public Service Commission from approving large electric utilities to retire certain power plant facilities as part of a rate case, electricity resource planning or other proceeding unless certain conditions are met.
Additionally, SB224 created a new cost-recovery mechanism to enable Rocky Mountain Power to recover costs for existing power plants governed by the Public Service Commission in order to keep those facilities running when neighboring states stop paying for the facilities. It also makes changes, which Utah Clean Energy calls "highly problematic," to how "proven dispatchable" resources are regulated by the Utah Public Service Commission.
"What we heard from the business community was, 'We need our energy to be affordable, we need it to be reliable and we need it to be sustainable,'" said Derek Miller, president and CEO of the Salt Lake Chamber. "You'll often hear that, but what we need to remember of those three things is they need to be in balance. That's the way we need to move forward."
Although some may disagree on complicated issues like the housing crisis and Utah's energy future, Dean said he's optimistic the state will be able to come together and move forward with solutions that work for everyone.
"It's our ability, unlike many other places in the country, to come together to talk about hard things," Dean said. "It's that unification as a state, where people here along the Wasatch Front do care about what happens in rural Utah and rural Utah does care about what happens in the Wasatch Front."
