Thursday, July 27, 2017

Retail Trade in Utah:
How Online Sales are Reshaping the Industry and Its Workforce.

Consumer spending makes up around 68 percent of the nation’s gross domestic product. Consumer spending is individuals and families purchasing groceries, clothing, recreation, stocks, insurance, education and much more. The transactions cover a broad swath of economic activity.

Much of the nation’s consumer spending is captured via retail trade. A useful retail trade definition is “the re-sale (sale without transformation) of new and used goods to the general public, for personal or household consumption or utilization.” Not all consumer spending is captured through retail trade transactions, but a large share is.

Broad-category examples of retail trade sectors are motor vehicle sales, furniture stores, electronic stores, building material stores, grocery stores, pharmacies, gas stations, clothing stores and department stores, among others.

Then there is the relatively new and emerging part of the retail trade sphere — nonstore retailers. These are establishments that sell products on the internet. Examples include Amazon, Zappos,, or eBay. These types of retailers have grown rapidly in the past 15 years and their presence is reshaping the retail trade landscape.

Whereas in the past nearly all retail transactions were done through traditional brick-and-mortar stores, now a significant and growing segment is diverted to internet sales. The consumer shops online and FedEx (or like) delivers the product. One can see that the number of brick-and-mortar stores and the level of local sales across the country are being endangered by this economic evolution.

The brick-and-mortar reduction is beginning to show its economic presence in the United States employment numbers. While the U.S. economy is finally expanding at a healthy pace this side of the Great Recession, one of the few industries not rising with this tide is retail trade. While overall retail sales are increasing, employment is not.

Traditionally, as a population increases, retail trade employment grows simultaneously, since population growth and consumer spending volume is an integrated dynamic. If studied deeply, a certain ratio of retail trade employment growth spawned from population growth would emerge. Before the internet, the vast majority of all consumer sales occurred in the immediate community or region. But now, the internet is diverting these sales away from the local community — and with internet sales growing, its market share will increase.

We do not yet know how much brick-and-mortar erosion will eventually occur. And will such a phenomenon hit some areas more than others (e.g., urban vs. rural, or local vs. tourist spending)? These are touch points that economist will be watching as this internet sales phenomenon continues to grow within the national and Utah economies.

In light of this change, in this quarter’s Local Insights we are profiling retail trade employment throughout Utah’s local regions. This can offer a profile of where retail trade is now in a local economy, and possibly how much of the sector could become vulnerable to the internet-sales phenomenon.

A deeper look at each region can be found via the tabs at the top of the page.

Check Out the Viz
If you are interested in the details, the data visualization below breaks out the various retail categories and allows you to compare sales (as a share of total taxable sales) and employment (as a share of total nonfarm employment) in each category (by county) over time. The relative changes in taxable sales compared to employment are telling in relation to some of the structural changes being driven by online sales, although direct links are difficult to establish as there are many other confounding factors. The tables at the bottom give the actual sales and employment levels, summed-up for whatever you have selected in the county and retail category filters.

Wednesday, June 14, 2017

Utah's Economic Diversity and Jobs in 2016

By Cory Stahle, Regional Economist

Analysis upon preliminary employment data from the U.S. Bureau of Labor Statistics shows Utah finished 2016 with the sixth most industrially-diverse economy in the nation. While there are several ways to measure an economy’s industrial diversity, this analysis applied a statistical measure called the Hachman Index upon the annual BLS employment data for each state. For more on the Hachman index visit the following.

In addition to balanced industry employment, Utah also ranked first for job growth in 2016 and tied for third in GDP growth. This means that in 2016, Utah landed in the top 10 for all three indicators. The only other state to do this was Georgia.

The visualization below shows the Hachman Index and year-over employment and GDP changes by state for the past 15 years. Some of the highlights include:

  • Utah’s diversity index has ranked in the top 10 every year between 2002 and 2016.
  • Utah ranked first for year-over job growth in 2016 for the second consecutive year.
  •  In addition to the top spot last year, Utah posted top 10 employment growth in 10 of the last 15 years, with nine of those years in the top 5.
  • GDP growth in Utah has measured in the top 10 for the last four years.

Thursday, June 1, 2017

Is Your Town Growing?

U.S. Census Bureau releases 2016 City Population Estimates

By Lecia Parks Langston, Senior Economist

“A city is more than a place in space, it is a drama in time” –Patrick Geddes

Most of Utah’s cities and towns grew in 2017, according to population estimates recently released by the U.S. Census Bureau. Lehi even ranked 11th among the nation’s fastest-growing large cities. However, not all Utah’s cities and towns experienced growth.

Use the visualization and bullet points below to explore population trends for individual townships.

• The old Geneva Steel Mill site continues to be fertile ground for population expansion. Vineyard was once again the fastest growing city in Utah. However its rate of growth has slowed dramatically since 2015. In addition, Vineyard remains relatively small in size.

• Herriman added the highest number of new residents of any city in Utah (4,550) followed by Orem, Lehi and South Jordan. All showed higher population gains than Salt Lake City — Utah’s most populous city. Herriman also showed the second-fastest rate of expansion in 2016.

• St. George was the only city outside the Wasatch Front to increase its population by more than 2,000 residents.

• The top four population-gaining cities in Utah are all located in southern Salt Lake County or northern Utah County, as the metropolitan population continued to spread outward from the large city centers. Fastest-growing larger communities also tended to be located near the Salt Lake County/Utah County border.

• Due to the nature of percent-change mathematics, several small towns (such as Monticello, Mantua, Francis, Interlaken and Hideout) showed high growth rates although their new-resident counts measured relatively low.

• The Census Bureau estimates that most of the cities and towns showing population declines were located in the Uintah Basin, Carbon County and Emery County. Declines in resource-based employment have spearheaded these population declines.

• In addition, Millard, Piute, Garfield and Wayne counties displayed a significant number of contracting townships.

• Salt Lake County remains home to five of the 10 largest cities in the state. Utah County accounts for another two in the top 10. St. George is the only city in the top-10 ranking located outside the Wasatch Front.

Tuesday, May 30, 2017

Understanding Utah’s Future Skill and Knowledge Needs

The Utah Department of Workforce Services releases Skill and Knowledge-based Projections

By Lecia Parks Langston, Senior Economist

“It is possible to fly without motors, but not without knowledge and skill.” Wilbur Wright

The following skill and knowledge projections suggest that the foundation for future workforce preparation relies on those old favorites “readin' and 'ritin' and 'rithmetic.” Technical skills and knowledge areas are also important, but rely on an excellent foundation in basic skill and knowledge areas.

• Utah occupational projections and the Occupational Information Network (O*Net) provide the foundation for these skills and knowledge estimates.

• “Basic Skills” dominate the top 10 in-demand skills, suggesting a need to ensure training on “the basics” for all prospective workers.

• Basic skills needs cross occupational and educational boundaries. • Basic skills make changing occupations possible as the labor market changes.

• Communication skills and reading rank highest on the top skills list, followed by critical thinking. • The top five skill and knowledge areas are the same for every region of the state.

• The top 10 in-demand skills change very little regardless of the occupational training level.

• Customer Service ranks, by far, as the knowledge area with the highest projected demand.

• For occupations requiring formal training past the high school level, competence in English, computers/electronics, and mathematics becomes increasingly important — although these skills are in demand for employment at all training levels.

• Short-term shortages for certain technical skills may seem to displace the overarching need for all workers to have a strong foundation in basic skills in training discussions.