Halfway through the fiscal year, GOEO recruiting surpasses FY23

Brice Wallace 

The state’s corporate recruiters are halfway through their fiscal years, with generally strong numbers as they head into 2024.

The Governor’s Office of Economic Opportunity and its contracted partner, the Economic Development Corporation of Utah, presented their half-year stats during the GOEO board meeting in December.

GOEO’s 11 project wins halfway through its July-through-June fiscal year are expected to create a total of 6,183 jobs over the next few years, including 866 in rural Utah. The total already surpasses the entire fiscal year 2023, which is projected to create 3,630 jobs, including 1,380 in rural Utah. Fiscal 2022 was the agency’s record year, with 20,478 expected jobs, including 8,972 in rural Utah.

Meanwhile, EDCUtah, which still had a couple of weeks left to reach the halfway point of its fiscal year when the GOEO board meeting occurred, had 16 project wins expected to eventually create or retain 6,120 jobs. The full fiscal 2023 total was 26 wins tied to 5,152 new or retained jobs. EDCUtah’s goal for the current fiscal year is 8,000 jobs from 30 projects.

“And we’re ahead on all targets, so [we’re] really excited about where we’re tracking so far,” Erin Farr, EDCUtah’s vice president of business development, told the GOEO board. The organization is seeing strong new-jobs and square-footage numbers and is a little over halfway toward the goals on projects wins and project capital expenditure (capex).

EDCUtah projects this year so far are expected to use nearly 1.8 million square feet of space, putting it on a pace to top the prior year’s total of 2.8 million square feet and top its goal of 2.5 million square feet. Those projects also are expected to have capital spending of $837.6 million, toward a full-year goal of $1.5 billion. The fiscal 2023 total was a whopping $12.2 billion, aided by an $11 billion figure for a Texas Instruments semiconductor wafer fabrication project in Lehi that eventually will lead to 800 new jobs.

The Texas Instruments project likewise skewed fiscal 2023 numbers for GOEO. That year had a capex total of $12.35 billion, including $1.26 billion for rural Utah. Halfway through the current year, the capex figure was $833.8 million, including $356.3 million in rural Utah. The number for fiscal 2022 was nearly $2 billion, including $73 million in rural Utah.

Daniel Royal, director of business incentives for GOEO, noted that the current-year’s capex average per project was just under $76 million, putting it above the fiscal 2022 number.

The GOEO project wins this year are expected to generate new state tax revenue of $129.6 million, including $35.9 million in rural Utah. Fiscal 2023 had a total of $574.6 million, including $417 million in rural Utah. Fiscal 2022 had $942.4 million, including $572.4 million for rural Utah.

Halfway through the current fiscal year, new total project wages are projected to total $2.6 billion so far, including $485.7 million in rural Utah. That compares with fiscal 2023’s total of $4 billion, including $897.7 million in rural Utah. Fiscal 2022 saw a $12.7 billion figure, including nearly $5.3 billion in rural Utah.

Royal noted that the average number of jobs per project is lower.

“Fewer new jobs means fewer wages and means fewer new state revenues as well, so we’re kind of seeing the effects of that: higher capex, lower job numbers, which means lower new state revenue, compared to years in the past,” he said.

The average wage tied urban project wins is 71 percent above county average wages. The figure for rural projects is 59 percent above those county averages. Those are comparable to prior fiscal years.

Farr noted that EDCUtah’s pipeline is dominated by manufacturing projects, which account for 57 percent of its total. “So, no difference, really, in that past few years,” she said. “It continues to be the story that manufacturing dominates our pipeline.”

Scott Cuthbertson, president and CEO of EDCUtah, was happy with the half-year numbers.

“We’re making really strong progress as a state this year, ahead of targets and what’s been an uncertain economic environment, so we’re really thrilled to see the number of projects, the amount of capex, that we’re trending ahead of plan on all those fronts.”

Cuthbertson said the organization is generally seeing government subsidies prompting reshoring, “friend-shoring” into lower-risk markets and an energy transition from fossil fuels to renewables, all of which translates into massive capex projects like Texas Instruments’ landing in the U.S. markets.

Carine Clark, chair of the GOEO board, expressed optimism for the state’s recruiting future.

“I feel like the best days are still ahead of us,” she said, “so we still have a lot of work to do to continue to be attractive for other companies and countries to come and spend time with us, and maybe the Olympic push will help put an even brighter spotlight on Utah.”

The recruitment figures for GOEO and EDCUtah never match because not all EDCUtah projects qualify or go through the GOEO state incentives process.