Acute labor shortages prevent Utah employers from filling jobs

Washington County and the State of Utah are generally in a good economic position. The population keeps growing and unemployment keeps falling.

There is only one glaring problem: companies are not finding enough workers to fill their vacancies.

“Washington County is quite the growth machine there,” said Benjamin Crabb, regional economist with the Utah Department of Workforce Services.

Like most of the rest of the United States, the county’s job market was hit hard early in the COVID-19 pandemic. But the county recovered quickly, and the area has seen rapid increases in new jobs and new businesses for most of the past two years.

The United States Bureau of Labor Statistics estimated that Washington County’s adjusted gross domestic product was about $7.3 billion in 2020, having more than doubled since 2010, when GDP was about 3, $4 billion.

Crabb says that although the local economy has been impacted by the pandemic, jobs in Washington County have recovered at a “remarkable pace,” such that within five months of the pandemic, the total number of jobs is back to pre-pandemic standards. The most recent unemployment data from the Department of Workforce Services shows that Washington County’s unemployment rate is 2.3%, which is almost identical to the state average of 2.1%.

The fastest growing jobs in Utah are in retail, construction, and labor

According to Crabb, jobs in retail, construction, recreation and hospitality have seen the fastest growth, propelled by the region’s attractiveness for tourism and recreation and its rapid population growth rate – the US Census Bureau estimated last year that St. George was the fastest growing metropolitan area in the country at an annual rate of 5.1%.

Just before the pandemic hit, there were about 72,000 jobs in Washington County, but the state’s most recent data shows that as of September 2021, there were more than 78,000.

“Growth is largely due to location appeal,” Crabb said. “The geography, the stunning natural beauty of the whole area, the climate with great weather there.”

But as industries built around growth and tourism thrive, so do the challenges of staffing these industries.

Squeezed by the tight labor market

St. George-based Cox Trucking has experienced more acute labor shortages over the past two years, roughly coinciding with the onset of the pandemic, according to Shanna Lelli, business consultant for the company. .

“We had a really tough time during the real first part of the pandemic, hiring anybody,” she said. “And that’s only changing now where we’re starting to fill our trucks.”

Lelli said that because trucking is an industry where drivers need special permits to be employed, many trucking companies are competing for the same people to fill vacancies. Trucking companies have increased both wages and benefits, but Cox has always been understaffed by about 12% of its driving workforce, Lelli said.

At Watts Construction, a commercial construction company, the pandemic and a strong construction market have significantly reduced the number of subcontractors available to work on projects, said company CEO Chris Boudrero.

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“When we bid on a project, we usually get three or four bids per transaction. Now we are lucky if we get more than two offers per transaction,” Boudrero said. “It has to do with the busy construction market and labor and supply shortages.

This shortage of subcontractors, who make up nearly all of Watts’ construction crews, is reflected across all trades, according to Boudrero. He was hesitant to blame construction labor shortages on the pandemic and noted how the industry has coped with a tight labor market since the 2008 housing crash. The pandemic has brought new challenges, such as meeting contract schedules.

“Watts had to find creative ways to minimize the stretching of project schedules due to limited labor and supply chain disruptions on materials,” Boudrero said.

Companies across a wide range of industries have reported difficulty getting materials delivered since the start of the pandemic. For Watts, metal components have the most delays. For Cox, the biggest challenge has been ordering new trucks and parts to service its current fleet.

Boudrero estimated that construction costs have increased by 30-40% during the pandemic due to increased material and labor costs.

“With some companies overpaying during the labor shortage, it is difficult to verify that all of our wages remain competitive and will continue to retain and attract quality employees over the long term,” he said.

Crabb said the current labor market favors employees because it allows people to choose from higher-paying jobs and has industries competing for labor instead of individuals having to compete for jobs.

“Right now, the wage increases are good for the workers,” he said.

But the tight labor market may hamper the local economy in ways not captured by traditional economic data, Crabb added. He suggested Washington County’s labor market will continue to be tight for the near future, but growth is expected to remain flat due to Utah’s above-average birth rate and high population projections for the county. ‘coming.

“There will always be a need for labor to drive local economic growth,” he said. “But with population growth expected to continue in the area, I think it will be a growth area for some time.”

Sean Hemmersmeier covers local government, growth and development in Southwestern Utah. Follow @seanhemmers34 on Twitter. Our work depends on subscribers, so if you want more coverage on these issues, you can subscribe here: http://www.thespectrum.com/subscribe.

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