Brice Wallace
Using descriptions such as “insane” and “unbelievable,” Utah’s corporate recruitment organizations are saying that a surge early in the 2021-22 fiscal year has continued.
Officials at the Governor’s Office of Economic Opportunity (Go Utah) and the Economic Development Corporation of Utah (EDCUtah) said in December that companies’ interest in putting operations in Utah remains strong. Mimicking those of the first quarter of the 2022 fiscal year, the halfway-point statistics from Go Utah show that the year could set all kinds of full-year records, if they haven’t been set already.
Statistics released by Daniel Royal, Go Utah’s director of corporate growth and business development, at the December meeting of the Go Utah board show that Go Utah’s incentivized projects are expected to create over 12,000 jobs over the next few years. That’s already higher than the entire 2021 fiscal year, when job projections reached 8,595, and is nearing the fiscal 2020 record of 13,364 new jobs.
Capital spending on those projects is over $1.2 billion, already topping $1.13 billion in 2020. The fiscal 2022 projects are expected to generate new tax revenues of about $480 million. The figure last year was nearly $330.8 million and the record is $591 million in fiscal 2020, “so we’re definitely on the right track,” Royal said. Wages from the projects during the current fiscal year total nearly $10 billion, already topping the 2020 record of $9.7 billion.
Go Utah has started breaking out figures for rural projects, which Royal said account for about 40 percent of new incentivized jobs in the current fiscal year, a figure he said is up “drastically” since fiscal 2020.
Royal said the average project wage for rural projects is 41 percent above the average county wage and urban projects are 69 percent above the average.
Go Utah’s economic development partner, EDCUtah, will release fiscal year first-half figures in January, but Colby Cooley, vice president of business development at EDCUtah, told the Go Utah board in December that “we are off to a banner start the first half of the year.”
Already, the organization has eclipsed figures for new and retained jobs and capital expenditures, compared to all of fiscal 2020. It has nearly passed the project square footage record.
“So, fiscal year 2022 is insane, to be honest,” Cooley said.
EDCUtah’s pipeline of projects continues to grow, up 25 ahead of where it was a year earlier. In the first four months of the current fiscal year, the organization was averaging 17 new projects each month, far above the 10-12 once considered normal, he said.
“So we continue to field a lot of incoming, inbound project activity,” he said, adding that EDCUtah is also involved in its own lead generation. “Just really across the board, no shortage of activity,” he said.
Manufacturing projects continue to dominate, accounting for about 60 percent of active projects during the first four months of the fiscal year. Utah’s activity is symbolic of a national trend, he said, as COVID-19 changed consumer habits and supply chains experienced breakdowns.
“This time next year, are we having the same conversation? Or do these companies, after a couple of years, a couple of cycles, get caught up, get back into a more comfortable situation and then we hit an equilibrium? I don’t know the answer to that. It doesn’t feel like it’s slowing whatsoever,” Cooley said.
Ben Hart, Go Utah’s deputy director, said that structural shifts in the global economy are resulting in jobs returning to the U.S. and bolstering U.S. supply chains. Utah should be aggressive as companies look to reshore or onshore operations, he said.
“What we’ve found so far is that there is a significant interest in the United States from the global healthcare industry,” he said. “So, again, we want to create the best net possible to bring as many of those opportunities, as much of that growth, here to the state of Utah as is possible.
“Tech has been our [growth] leader here in the state for the last decade, as has financial services. We really think that it’s life sciences’ and healthcare’s turn to really take that next step in terms of sophistication and an industry that will really move our economy for the next generation.”
Hart described the past 18 months as “tumultuous.”
“But as we’re looking into 2022, I think I can speak for all of us, we’re incredibly optimistic. The fundamentals of this economy are in place. We realize that there are some things out there to be concerned about — the unemployment rate and also inflation and other things — but the fundamentals of the economy are incredibly sound,” he said.
“As difficult as 2021 was, it was a banner year for us, and we’re optimistic that 2022 will be even stronger and we have a lot of reasons for our optimism.”
Both Go Utah and EDCUtah use July-through-June as their fiscal year periods. The project figures they report never match because not all of EDCUtah projects go through the state incentive process.
