In the Summer 2013 issue of Statewide Local Insights, the feature article addressed the industrial diversity of the Utah economy. The analysis concluded that Utah has a very diverse economic base. This means its distribution of employment is desirably spread out across various industries. In other words, Utah has its industrial eggs in many different baskets. Through a grading tool called the Hachman Index, Utah’s economic diversity measured 97.6, meaning the Utah economy is 97.6 percent as diverse as the United States economy. The United States economy is viewed as the most diverse standard against which to measure a local economy and its industry employment distribution.
Peering more deeply into the Utah economy shows where that diversity is located. Taken as a whole, the Utah economy is quite diverse, but when you dissect the Utah economy by individual counties, you instead find more industrially-concentrated economies. The majority of the state’s diversification comes from Salt Lake County alone, which accounts for nearly half of all Utah employment. Add in the industrial diversity of fellow metro counties Davis, Utah and Weber—now 80 percent of the state economy—and the state’s overall diversity emerges. These four counties are the chief contributors to Utah’s economic diversity.
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A diverse economy is an outcome of market factors of a given region. Rather than being artificially created, a local economy’s industrial diversity is developed organically depending on the size of the population and the endowment of natural resources. Thus, it is less likely for small population counties to be economically diverse given that they simply have a smaller distribution of residents and resources. So naturally, Utah’s numerous small counties will have less diverse economies.
Mapping the diversity reveals a regional look. The core of high diversity in the Wasatch Front metropolitan counties stands out. The counties surrounding those within the Wasatch Front then offer the first lower level of industrial diversity as part of their proximity to the urban population mass.