Summit County’s economy is down due to COVID, but less than officials anticipated | ParkRecord.com
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Summit County’s economy is down due to COVID, but less than officials anticipated

Thousands of jobs have yet to return, while tax revenues haven't fallen as sharply

The Summit County Courthouse.
Park Record file photo

In the early weeks of the pandemic, the Summit County government slashed 10% of its budget, anticipating a massive dropoff in revenue as the local tourism-driven economy ground to a halt overnight.

A year later, data is rolling in about the actual impacts of the pandemic, and county officials are saying that things aren’t as dire as initially feared.

Still, the economy has shed thousands of jobs and more than $115 million in gross regional product compared to pre-pandemic levels.



“I think we’re still a little bit hesitant to say that all is well, but things are looking good,” said Matt Leavitt, Summit County’s finance director.

According to a report accompanying a presentation Leavitt gave to the County Council on Wednesday, the county actually saw an increase in revenue at the end of 2020.



“Despite anticipating a negative impact up to 25% decrease in revenues due to the pandemic at year-end the County received 6.6% increase in revenues,” Leavitt wrote.

Many East Side communities saw increased sales tax revenues over the 9-month period of the pandemic compared to previous years, while Park City’s sales tax receipts dropped 13%. Leavitt theorized that trend may have to do with people shopping online or closer to home as they worked virtually during the pandemic.

Last April, the county anticipated $980,000 in decreased local sales tax revenue in 2020, but only saw a decrease of $167,000, Leavitt wrote. Another sales tax that was estimated to fall by $700,000 actually saw a $124,000 increase, he added.

While revenues were better than anticipated, job losses played out on a significant scale. Accomodation and food service jobs fell off by more than 25% year-over-year, but county revenues tied to those industries only decreased about 12%.

When the pandemic hit last March and the ski resorts closed shortly thereafter, the county’s economy immediately shed thousands of jobs. According to a report from Jeff Jones, Summit County’s economic development director, there were nearly 6,000 jobs in the arts, entertainment or recreation sectors countywide in February 2020. Weeks later, that number had crashed to fewer than 1,000 at a low point in April.

Those sectors include seasonal resort employees and have a normal seasonal dropoff. As of this January, however, there were about 1,000 fewer jobs compared to last year.

The numbers for the hotel and restaurant industries were only slightly better, Jones reported. The accommodation and food service sectors lost nearly 6,000 jobs as the pandemic hit, a 72% dropoff. In January, while nearly 3,600 jobs had returned, the total was 2,300 fewer than immediately before the pandemic.

The pandemic’s economic impact, by the numbers

Initial impact

32,290 – number of jobs countywide in January 2020

17,786 – number of jobs in late March/early April 2020

14,504 – number of jobs lost in the first weeks of the pandemic

$117,034,913 – decrease in gross regional product from 2019 to 2020, a decline of 3.1%

Recovery

28,202 – number of jobs in late January 2021

4,088 – number of jobs lost from pre-pandemic high

Source: Summit County, EMSI Developer, Utah Department of Workforce Services

One bright point, Jones said, was that there didn’t appear to be widespread permanent business closures, though he said many had likely lost a significant number of employees. He indicated that the pandemic had likely changed some aspects of labor markets forever.

County staffers indicated that the recently enacted American Rescue Act would provide more than $8.1 million to help offset the county’s pandemic-related costs. The money is expected to start arriving next month, and officials indicated the county would likely be able to apply for additional funding.

Jones said that the pandemic had different impacts on different sectors of the economy, with low-wage earners being hit disproportionately hard. In a report that accompanied his presentation to the County Council, Jones indicated that Park City area’s tourism-based economy featured many businesses in the hardest-hit industries.

“The COVID-19 pandemic triggered a recession that affected all industries. However, the leisure and hospitality industry — including accommodation and food services and arts, entertainment, and recreation — are the most severely affected industries and will not fully recover until well after the vaccines have been deployed,” Jones wrote.

He added that some businesses, like grocery stores, bike shops and home remodeling centers did well.

Jones shared predictions on when the area’s economy might be “back to normal, whatever normal is.”

The predictions ranged from Gov. Spencer Cox’s target of July to Jones’ optimistic date of September to what he said was the most likely scenario: November. He said April of next year would be a “worst-case scenario” if the virus is not contained.

“If Governor Cox and others are correct, Summit County might return to full employment by the 4th quarter of 2021,” Jones wrote.

Impacts on hardest hit industries*

Accommodation and food service jobs in Summit County

8,224 – jobs in February 2020

2,329 – jobs in April 2020

72% – jobs lost almost immediately

Recovery

5,945 – jobs in January 2021

2,279 – fewer jobs than immediate pre-pandemic high

Arts, entertainment, and recreation jobs in Summit County

5,870 – pre-pandemic high in February 2020

852 – early pandemic low in April 2020

85% – percent of jobs lost almost immediately

Recovery

4,889 – jobs in January 2021

981 – fewer jobs than immediate pre-pandemic high

Source: Summit County, EMSI Developer, Utah Department of Workforce Services

*Note: These job sectors experience significant seasonal fluctuation when ski season ends in the spring


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