For the last decade, Idaho has been one of the fastest growing states in the U.S. The Idaho Department of Labor predicts job growth in the state will continue to rise by 1.3% in the next ten years, about four times faster than the national average.
While growth in the state is currently outpacing the rest of the country, Boise State University economics professor Rafael Ribas said the state’s projection is based on only last year’s numbers.
“I wouldn't trust that projection that much,” he said, because using only one year’s worth of data is tricky.
“I do see Idaho growing above the U.S. average in the near future. But I cannot go beyond two years or five years,” Ribas added.
Especially since Idaho’s economy depends on a handful of large employers, like Micron Technology.
“There's not just not enough diversity when it comes to the economy,” he said, adding a lot of things can happen to disrupt a steady growth line.
Things that attract people to Idaho will also change over time, Ribas said, pointing to the state’s cost of living.
“It's much lower than in other places. However, as the population grows faster and faster in Idaho, of course, the living costs in Idaho will increase more than in other states. So at some point, this growth has to stop.”
Right now though, growth is outpacing the national average and Idaho continues to attract newcomers, driving the demand in non-tradable sectors. Maintaining that momentum, Ribas said, requires public investment which relies on tax revenue.
“If you're not making those investments right now and you start having those bottlenecks again in healthcare, in education, in roads, in housing, sooner or later, that population growth that you see in the data will slow down very quickly,” he said.
“Then the question is, is the government waiting for the tax revenue to make that investment or is making that investment with the projection of increasing your tax revenue in the future?”
According to the report, construction and healthcare are the fastest growing sectors in the state.
