Should Utahns worry about a recession after the latest jobs report?

SALT LAKE CITY — The latest jobs numbers weren’t exactly good news. The U.S. economy added fewer jobs than expected, and unemployment ticked up, which sent the stock market diving.

So, are we in a recession?

“I don’t think we are today,” said Phil Dean, chief economist at the Kem C. Gardner Policy Institute at the University of Utah.

But, he added, “I think the risk is closer.”

The U.S. added 114,000 jobs in July, and unemployment moved up to 4.3%, which was worse than expected. However, Dean pointed out there was job growth, and the unemployment rate is still quite low.

“That’s roughly what’s considered to be full employment where you have balanced supply and demand,” he said.

The latest unemployment figure triggered some panic over an economic theory which “holds that a recession is almost always underway already if the three-month average unemployment rate rises by half a percentage point from its low of the past year,” the Associated Press reported.

However, the author of that theory, Claudia Sahm, said she doubted a recession was “imminent” because of other factors at play in the economy, according to the AP.

Dean said he wants to see how the Federal Reserve responds, possibly by cutting interest rates at its next meeting, which usually jumpstarts the economy.

As for Utah, he said the latest data showed the statewide unemployment rate was at 3%.

“I expect we’ll continue to outperform the economy,” Dean said. “That doesn’t mean there won’t be fluctuations with us and the U.S., but we’re better situated than the U.S. overall.”

Still, Dean said, it’s clear there is a slowdown in job growth happening in the country.

“We’ll see how it goes in coming months,” he said, “but there’s definitely softening taking place in labor markets across the U.S.”

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