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Show Sat/Sun/Mon/Tues, November 22-25, 2008 A-7 The Park Record Utah economist predicts 19,000 job losses By BROCK VERGAKIS Associated Press Writer SALT LAKE CITY (AP) - A state economist forecasts that Utah will lose up to 19,000 jobs next year and reach an unemployment rate of up to 5.5 percent in what would be one of its worst economic downturns in more than half a century. "That would be the worst economic environment we've had since 1954. We've only had four times since 1950 where there's fewer jobs in one year than there was the previous year," Mark Knold, chief economist for the Department of Workforce Services, said in an audio podcast released with the state's October employment report on Tuesday. The report said Utah lost £,200 jobs in October compared with the same month last year. That's a decline of .2 percent. I,? It is the first time in 2008 Utah has experienced negative job growth. Utah's economy is no longer hurting just because of a slowdown in the housing and construction industries, Knold said. T l ^ slump has now expanded to manufacturing, financial activities, and professional and business services. "It's very, very difficult to see a strong rebound of any kind," Knold said. "It does seem to be the trend of the economy ... for further down- ward movement before we find (the) bottom and turn it around." Still, the state's unemployment rate remained steady in October at 3.5 percent, the same as in September. Last October, the state's rate was 2.8 percent. However, Knold said Utah's unemployment rate is likely to rise. "We do expect that to start speeding up in terms of its climbing," Knold said. "By the time we kind of finish out 2009, I wouldn't be surprised to see Utah's unemployment rate up to 5.5 percent." Nationally, the unemployment rate is 6.5 percent. Knold said Utah likciy won't surpass the national rate, but its not isolated from the national economy. "Having this ... almost like an immunity to what's going on - ho, we're not going to be seeing that as we move forward," he said. "We shine brightly in the good economic environments ... but this one's too big. We're going to have an economy that's being dragged down by it all." Knoid said the only bright spots in Utah's economy are in the education and health care sectors. "You just can't ignore it no matter what the economy is like. You've got to educate the kids. Health care is the same thing," he said. Knold's report comes out a day after the Utah Tax Commission said state revenues over the past four months are down significantly over the same period last year, creating the possibility that budget cuts might be necessary when the Legislature meets in January. The Legislature met in a special session in September to trim $272 million from this year's state budget after state economists revised their economic forecast for this year, but the revenue report shows the state is on pace to take in even less money than the economists' altered forecast. A revised budget forecast for this year and a new one for the upcoming year will be released in December. It's unclear how the slumping economy will affect the plans of Gov. Jon Huntsman, who has said that among his budget priorities is a goal to bring Utah's teacher salaries up to the national average. In each of Huntsman's first four years in office Utah's economy was strong. He was able to cut taxes by hundreds of millions of dollars and give record increases for education spending - though Utah still has the nation's largest class sizes and spends less per student than any other state. A message left with Huntsman's spokeswoman, Lisa Roskelley, was not immediately returned on Tuesday. MOTORIZED WINDOW EXPERTS State revenues lower than revised forecast wailing and gnashing of teeth from ail of us," he said. "It's not a fun job to cut programs when you SALT LAKE CITY (A ) - If see the impact on people, but if Utah's economy doesn't improve you don't have the money, you soon, lawmakers could be forced don't have the moriey." to make more budget cuts. The state's transportation revA state tax commission report enues are also rapidly declining released Monday shows thai rev- from last year's figures. enue from July through October Economists had forecast a .3 perhas declined at a greateij rate cent increase in transportation than state economists had!fore- revenues from fuel taxes and cast for this fiscal year wheiji they motor vehicle registration fees, revised figures for a September but in the first four months of this special session. fiscal'year revenue declined 8 Economists projected 2.4 percent compared with last year. percent decline in the state's genUtah's economy also has been eral and education fund in particularly hard hit by a slowSeptember. Monday's report down in the housing and conshows revenues were down 7.3 struction industries. percent. Revenue from income taxes - Lawmakers cut $272 mi lion which fund the state's public from the state budget in the ;pe- schools - is down 12.6 percent, cial session after the revt hue compared with the same period forecast was revised to reflect a last year. : slumping economy. While most state" agencies Senate Budget Chairman Lyle took a 3 percent budget cut durHillyard, R-Logan, said more ing the September special sescuts may be in order when taw- sion, public education was largely makers reconvene in January." spared. "It's going to be a weeping, Hillyard said that might not be By BROCK VERGAK Associated Press Writ the case in January. "I would have a hard time seeing how we wouldn't have to do some (cuts)," he said. "I think public education will be impacted, but we'll be as careful as we can not to impact the classroom." Gov. Jon Huntsman's spokeswoman, Lisa Roskelley, said the governor's staff was evaluating state revenues and would be prepared to make recommendations when a new forecast is issued in December. "We're going through our normal budgeting process and we'll go from there," she said. In recent years, Utah has been flush with cash and the toughest decisions lawmakers had to make revolved around how to spend billion-dollar surpluses. In the first few weeks of the session, the Legislature often agreed to fund state agencies at 100 percent of what they received the previous year. Hillyard said lawmakers are already talking about'reducing that amount to 90 percent as they work on next year's budget. 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