Utah economy healthy, growing stronger, says chief economist

SALT LAKE CITY — Reports show the economy is growing stronger, so why don’t we feel it? A Utah financial authority says the economic indicators are pointed in the right direction.

Natalie Gochnour, director of the Kem C. Gardner Policy Institute at the University of Utah and who is also chief economist for the Salt Lake Chamber, joined Dave Noriega and guest host Abby Osborne on a recent episode of Dave and Dujanovic.

Dave said he has heard the unemployment numbers are good and that inflation is easing, but he said he still feels “strapped.”

Abby said it’s great gasoline is below $3 per gallon — “It’s right in your face” — but she feels the pinch of inflation while grocery shopping.

Gochnour said the numbers show that both the nation and the state are economically healthy. The U.S. unemployment rate is now 3.7% while Utah’s rate is 2.7%, down from 10.0% in April 2020, according to data from the state Department of Workforce Services.

“Yes, people feel stresses,” she said. “I think a lot of that is related to . . . the unwinding of a pandemic. But the economy’s raw numbers look quite good.”

Pandemic hangover

Abby pointed out most everyone received money from the federal government during the pandemic. She asked if people were feeling the loss of that supplemental money supporting them one or two years ago.

Gochnour said the federal government paid out 5% of the GDP (gross domestic product) in pandemic relief to U.S. citizens. The United States’ GDP in 2021 was $23.32 trillion. That’s $5.83 trillion in checks sent out.

“That’s extraordinary. It’s too much. And it’s really what led to a lot of the inflationary pressures that that we felt,” Gochnour said.

Economy growing stronger 

In the summer of 2022, inflation was above 9% but now stands at 3.2%, Gochnour pointed out.

Monthly 12-month inflation rate in the United States from October 2020 to October 2023

“We’re on a positive track,” she said. “I think consumers should feel better than indicators show.”

Dave said inflation can set new price points for goods and services. In other words, the price will not return to the amount it was before inflation increased it.

“That’s the very definition of inflation — your dollar is no longer worth what it used to be.”

However, wage gains have been outpacing inflation for this entire year, Gochnour said.

“So even as your price point changes, so does your wage level. And that’s just part of how economies work,” she said.

Related: On economy, Utah small-business owners share same concerns as national cohorts

Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.