ST. GEORGE — Dynamic — that is what the National Bureau of Labor Statistics has labeled St. George in relation to the metropolitan growth of the construction sector.

On Aug. 10, the real estate media source Point2 published an article about the results of a study combined with statistics performed by the bureau. In defining the term “dynamic,” Point2 said, “dynamic metros are faring the best when it comes to providing opportunities for construction workers.” According to the study, the top 2 most dynamic metros for construction jobs in 2022 are Kennewick, in the state of Washington, and St. George.

“This doesn’t surprise me. We have seen a 5% job growth in the St. George area, as well as the population growth and the continual construction needed makes this very viable,” said Ben Crabb, who serves as the regional economist for the southwest and central areas under the Utah Department of Workforce Services.

Crabb maintained a positive outlook when speaking about the economic future of Utah.

“Construction has been growing at an 8% rate. Very rapid,” he said.

The latest unemployment rates for Utah also were released on Aug. 19. The state unemployment rate stays steady at 2%, lower than the national rate of 3.5%, according to the latest statistics released by the Department of Workforce Services.

According to the release, Washington County had a 2.1% unemployment rate, a drop of 0.1%, since June. Iron County remains at 2.2% unemployment. Utah has approximately 35,300 unemployed residents.

Among other essential criteria and standards that needed to be met, only metropolitans with more than 1,000 construction/building permits issued in the first half of 2022, between January and June, were considered in the Point2 study.

David Cordero, communications and marketing director for the city of St. George, told St. George News they have seen a growing amount of building permits in the last decade.

Crabb relayed the number of residential homes has been on the increase since 2010. The increase is due to several factors, Crabb said, such as population growth from retired individuals looking for a place to settle down, families looking for better educational opportunities for their children, and a stable environment with the ability to maintain available jobs and essential living needs.

“It really has been a growing field for almost the last two decades,” Crabb said.

Both of the other categories of building permits issued declined during the COVID-19 pandemic but are once again are on the rise, especially in industrial and commercial buildings. It is only halfway through 2022, and the number of building permits issued this year has almost doubled all of last year for permits issued.

The eight indicators must be present

Eight factors were considered by Point2 specialists when analyzing the metropolitans. These eight factors consisted of (1) number of jobs, (2) wage, (3) building permit change, (4) housing units, (5) permits per housing unit, (6) construction establishments, (7) location quotient and (8) cost of living.

Each factor received weight to reflect its importance in obtaining the final rank

• Construction jobs in 1,000 jobs (20%)
• Mean wage for construction occupations (20%)
• Change in housing units (10%)
• Change in building permits for January-June 2022 vs January-June 2021 (10%)
• Permits per housing unit (10%)
• Change in the number of establishments (10%)
• Location quotient (10%)
• Cost of living (10%)

Definition of “establishment”

An “establishment” is defined as a single physical location at which construction-related business is conducted or services or industrial operations are performed.

A company or enterprise consists of more than one establishment.

A single-unit company operates only one establishment, while a multi-unit company owns or operates two or more establishments.

Location quotient is considered

The location quotient compares the industry’s concentration to the nation’s industry concentration in the same field. So the education construction projects of St. George would be compared to the education construction projects in the rest of the nation, for example.

It is done on a number scale with bigger than “1” being a greater amount of the local area employment than the national caseload.

Most current statistics and data available were used

The results of statistics from construction employees (2021), mean wage (2021), establishment changes (2020 vs 2017), building permits (January-June 2022 vs January-June 2021), and housing unit changes (2020 vs 2015) were used.

Sources used for the study

Data on population, housing units, building permits, and construction establishments were extracted from the U.S. Census.

Data about employees/jobs, location quotient, and annual wage was extracted from the Bureau of Labor Statistics.

The Cost of Living Index was calculated by Advisor Smith, a website dedicated to helping people find the best financial options. They compiled a study called the City Cost of Living Index (Coli), which comprises information pertaining to living expenses in 509 metropolitans.

The Coli analyzes six major categories of living expenses with an assigned weight; Food: 16.1%, Housing: 23.2%, Utilities: 10.1%, Transportation: 18.6%, Healthcare: 9.6%, and Consumer Discretionary Spending: 22.3%

The Coli also has a unique tool called the Cost of Living Calculator. This helps figure out how much income is needed to maintain a current living style if moving to another location.

Recession rumors

On national news in recent weeks, predictions of a recession in the near future have been discussed. These predictions have been put forth by economists and specialists within certain fields, with estimations of a recession hitting the national economy within one to two years.

Crabb does not see it happening anytime soon.

“There are multiple facets to a recession, and though it is unknown at the moment if there will be a recession in the future… Our labor market is strong, as well as lots of job openings. This serves as a buffer against the possibility of a recession. Let’s not sound the alarm about recession yet,” Crabb said.

In fact, Utah has been a hot spot for growth in three categories of employment industries. Construction is at the forefront with a rapid 8% growth rate, while the retail and trade industry has been blossoming with a nearly 7% growth, and lastly, the leisure and hospitality industry produces 14% of all jobs within the state’s economy.

“There was a massive increase in leisure and hospitality starting early 2021,” Crabb said.

“Nationally, baby boomers are leaving the labor force faster than new ones are entering. This is producing unfilled jobs, lowering gross domestic product, making labor searches difficult, and contributing to higher inflation through increased wage bidding. This labor deficit is why negative GDP change is not morphing into a jobs recession,” Mark Knold, chief economist at the department of workforce services, said.

Utah’s biggest problem in the construction industry

The biggest problem Utah is facing with the fast construction job growth is filling the jobs with applicants who are skilled for the specific type of labor needed. An applicant with welding skills may not be finding job opportunities with a need for welding knowledge. This means more businesses are having to do on-site training to keep up with the rapid pace of construction growth.

Still, it is sunny in Utah with no worry of recession as the economy is stable with a growth in population, jobs, and positivity in life.

“Utah has been a bright spot of growth since 2003,” said Crabb. “Construction is the backbone.”

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