UT Economy, The Tops

If you're trying to sell your home today, it may surprise you to learn two cities in Utah are among the nations top three fastest growing job markets. For some time I've been writing about the tug of war going on in Utah between our ABOVE average job market versus the slowdown in real estate. I DID believe our economy would keep real estate steaming ahead. While that has not happened, our market is still healthy relative to the rest of the nation.

These new findings are great news for the real estate market, especially when we look at the kinds of jobs Utah is creating. The new findings by the Miliken Institute show Utah at the CUTTING EDGE of the NEW ECONOMY, providing high income tech jobs. Yesterday, I met two new friends at a luncheon, Tommee from Canada, Ya Ching from Taiwan, both process engineers. None of us had met before or knew each other, so it struck me as interesting. We are attracting the BEST educated from around the world, people who can truly write their own ticket. With a Ph.D. in engineering, Ya Ching could have gone anywhere, but chose Utah for the lifestyle, in addition to a great job offer.

The following spells out why Utah should continue at the top of our nations economy, from Fridays Salt Lake Tribune.

Utah's urban corridor is at the forefront of the "new economy."

So much so that three Wasatch Front metro areas are in the Top 25 in the United States in the annual Best-Performing Cities index compiled by the Milken Institute and Greenstreet Real Estate Partners. Provo-Orem is in the No. 1 spot, with Salt Lake City at No. 3 and Ogden-Clearfield 18th.

The rankings speak to Utah's combination of institutions of higher education that spin off research into commercial products, the concentration of high-tech and medical science companies and a competitive pool of capital.

Report author Russ DeVol, an economist and director of Regional Economics at the Milken Institute, also cited the low cost of doing business in Utah, a pro-business attitude and the state's comparatively small exposure to the subprime mortgage crisis.

"So Utah overall has been the best performer in the past few years," said DeVol.

Jason Perry, executive director of the Governor's Office of Economic Development, said the Milken index is just one of several recent reports that rank Utah as a top state for doing business and for its high-tech industry. Milken is important because it looks at long-term economic indicators that the state also uses to decide how to spend money on economic development efforts, he said.
"Certainly we take from this that we are doing this right. It helps guide us as we help to recruit companies in the future and grow business here."

This was the ninth year the institute has ranked urban-area economies. The Best-Performing Cities study is based on job creation and retention, the quality of jobs being produced and overall economic performance.

The Utah urban areas received high ratings because the jobs created here generally are higher-paying and linked to the state's booming technology and life-sciences sector.

Those types of jobs are dependent upon what DeVol calls the intangible economy, which is knowledge-based, often developed at universities and characterized by the importance of human capital and intellectual labor.

That contrasts to the "old economy," based on manufacturing in which jobs were relatively low-skilled and in such places as Michigan and Ohio.
"Other areas have seen a large loss of jobs to China," DeVol said. "Utah is not as tied in as closely to what some called the old economy."

Emphasizing the shift away from the manufacturing economy of the so-called Rust Belt, the South had 16 metro areas among the top 25 of the index, while the West had eight.

Among other reasons, Provo-Orem jumped from the eighth place in the index last year to No. 1 based on increased research at Brigham Young University and the subsequent spin-off of jobs into the private sector.

Although BYU is mainly a teaching institution with a relatively small research budget, it has faculty who are entrepreneurial-minded and its highly rated Marriott School of Management offers a number of classes on entrepreneurship, said Mike Alder, director of the Office of Technology Transfer.
''We have had a lot of research in new drugs, in diagnosis and in medical devices,'' he said.

Shauna Theobald, chair of the Utah Valley Entrepreneurial Forum, which promotes business start-ups, said an "ecosystem" has developed in Utah County that feeds entrepreneurial activity. That includes a history of high-tech companies stretching back to WordPerfect and Novell and a group of Angel investors, individuals who pour money into start-ups.
"We've got the money. We've got the inventors. We've got the experience," said Theobald, a manager at Novell's Open Source Technology Center.

DeVol said Salt Lake City benefits from the presence of the University of Utah, particularly its medical research. The metro area also has a high concentration of computer hardware and software companies, and strong financial and medical companies that are regional leaders.

Hill Air Force Base helps drive the economy of the Ogden-Clearfield area, which moved up 42 places from last year in the Best-Performing Cities index.
"Hill has been an important anchor in drawing a number of aerospace-related firms to the area," said DeVol.

In southern Utah, St. George ranked in fourth place among small cities after being No. 2 last year. Much of that area's economy is based on construction, which has been hit by the downturn in the nation's housing market.