Natalie Gochnour - Ivory institute 2011

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Utah Positioned for the Future …

Natalie GochnourSalt Lake Chamber

November 18, 2011

Top of Mind Words | U.S. Economy

Skittish

Uncertain

Vulnerable

Dispirited

Underperforming

SourGlum

Angry

FlatFrustrating

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“We are seeing the worst economic numbers since the collapse of Lehman Brothers in 2008…We are poised for a Lehman-like event.”

Fareed ZakariaGlobal Public SquareSeptember 25, 2011

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“The U.S. economy is surrounded and unable to break through enemy lines.”

Wells Fargo Securities Economic GroupSeptember 7, 2011

What is going on?

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“We can have a hard decade or a bad century.”

Thomas Friedman

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“It makes no sense for China to have a better rail system than us, and Singapore having better airports than us. And we just learned that China now has the fastest supercomputer on earth – that used to be us.”

- President Barack Obama

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"My biggest beef is that this is part of what's happened in this country…I think we've become wussies. ... We've become a nation of wusses. The Chinese are kicking our butt in everything. If this was in China do you think the Chinese would have called off the game? People would have been marching down to the stadium, they would have walked and they would have been doing calculus on the way down.”

- Gov. Rendell

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Utah’sSecretSauce

Demography is destiny

Economic diversification

Global engagement

Fiscal prudence

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Population Loss

NM13.2%

UT23.8%

AZ24.6%

CA10.0%

NV35.1%

OR12.0%

TX20.6%

OK8.7%

CO16.9%

WA14.1%

ID21.1%

MT9.7%

WY14.1%

ND4.7%

SD7.9%

MN7.8%

NE6.7%

KS6.1%

IA4.1%

MO7.0%

AR9.1%

LA1.4%

WI6.0%

IL3.3%

IN6.6%

OH1.6%

FL 17.6%

TN 11.5%

KY7.4%

MS4.3%

AL7.5%

GA18.3%

SC15.3%

NC 18.5%

VA13.0%

WV2.5%

PA3.4%

NY2.1%

ME4.2%

AK13.3%

HI12.3%

MA3.1%

VT2.8%

NH6.5%

RI0.4%

CT4.9%

NJ4.5%

DE14.6%

MD9.0%

MI-0.6%

15% to 25%

5% to 15%

DC5.2%

25% or more

0% to 5%U.S. Rate = 9.7%

Source: U.S. Census Bureau, 2010 Census

Population Percent Change: 2000-2010

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Source: GOPB Analysis of Bureau of Economic Analysis Data, Hachman Index

Most Diversified Economies in the Country

Index of economic diversity, U.S. = 100

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2002 2003 2004 2005 2006 2007 2008 2009 20100

2

4

6

8

10

12

14

16

4.5 4.1 4.76.1

6.87.8

10.3 10.34

13.81

Utah Merchandise ExportsBillions of $

Source: World Trade Center Utah

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State of Utah Rainy Day FundCombined General and Education Funds

FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$19.5$27.1

$66.9

$146.1

$254.9

$313.4

$413.8 $418.5

$209.8

$106.0

(millions)

Source: Governor’s Office of Planning and Budget

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Utah Job GrowthMonthly Year Over Percent Change

August-09

Sep-09

Oct-09

Nov-09

Dec-09Jan-10

Feb-10

Mar-1

0

Apr-10

May-1

0Jun-10

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

Dec-10Jan-11

Feb-11

March

-11

Apr-11

May-1

1Jun-11

Jul-11

Aug-11

Sep-11

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

-4.4%-4.1%

-3.3%-3.1%

-2.8%-2.9%

-2.3%

-1.9%

-1.4%

0.7%1.0%

1.5% 1.5% 1.5%1.2%

1.5%

0.8%

1.5%1.8%

1.6% 1.5% 1.6%

2.1%

2.5%

2.9% 2.8%

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Utah Labor Market IndicatorsSeptember 2011

Utah unemployment rate 7.4%U.S. unemployment rate 9.1%

Year-over Utah job growth rate 2.8%Year-over U.S. job growth rate 1.1%

# Unemployed in Utah 99,400# Discouraged workers in Utah 35,000-65,000

Source: Utah Department of Workforce Services and Salt Lake Chamber

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Utah Job Growth by IndustrySeptember 2010–2011

Government

Other Services

Leisure and Hospitality

Education and Health

Prof. and Business

Financial Activities

Information

Trade, Trans, Utilities

Manufacturing

Construction

Natural Resources

Total

-1 0 1 2 3 4 5 6 7

-0.8

2.5

4.2

2.4

7.0

0.6

2.7

3.0

5.7

-0.4

6.2

2.8Chart Title

Year-Over Percent ChangeSource: Utah Department of Workforce Services

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Jan-87

Sep-87

May-88

Jan-89

Sep-89

May-90

Jan-91

Sep-91

May-92

Jan-93

Sep-93

May-94

Jan-95

Sep-95

May-96

Jan-97

Sep-97

May-98

Jan-99

Sep-99

May-00

Jan-01

Sep-01

May-02

Jan-03

Sep-03

May-04

Jan-05

Sep-05

May-06

Jan-07

Sep-07

May-08

Jan-09

Sep-09

May-10

Jan-11

Sep-11

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Utah Weekly Unemployment Claims4-week moving average

Source: U.S. Dept of Labor, Unemployment Insurance Weekly Claims Data

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Utah’s Fastest Growing Detailed Industries(Year-over job growth shown in percentage)

- Heavy and civil engineering – 15.0%- Internet service providers – 12.4%- Computer systems design – 11.2%- Professional, scientific and technical services – 10.4%- Employment services – 8.2%- Administration support – 6.7%- Computer and electronic products – 6.5%

Source: Utah Department of Workforce Services

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Utah Economic Development Wins- Adobe (930)- Black Diamond Equipment (55)- ATK (820)- Litehouse (20)- Overstock (150)- ITT Corporation (2700)- Edwards Life Sciences (1,075)- Merit Medical (400)- Goldman Sachs (700)- EA Sports (100)- Royal Bank of Scotland

Source: Salt Lake Chamber of Commerce

- Pepperidge Farms (55)- NSA Center (7,000 const/300

perm) Litehouse (20)- eBay (50+)- Oracle (100)- Sephora (500)- Hershey (125)- Procter and Gamble (600)- IM Flash - Reckitt Benckiser (100+)- Incomm (100+)

Note: Job growth shown in parentheses

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Headwinds

European debt crisis

Political dysfunction

Housing recovery

Lower commodity prices

Consumer confidence

MENA crises

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Tailwinds

U.S.Two years of correction

Corporate profits

Falling labor costs

UtahDemography is destiny

Economic diversification

Global engagement

Fiscal prudence

Downtown Rising

PAC 12