While Utah’s economy remains strong, there are signs it may be slowing with rising interest rates and inflation, according to Dave Davis, president and chief legal officer for the Utah Food Industry Association.
The state’s unemployment rate of 2 percent is about 1.5 percent lower than the national average, but Davis said workforce continues to be a “huge concern” for Utah’s retailers. Inflation and the COVID-19 pandemic also continue to present challenges, with the former being a major concern for grocers and their customers.
“We are experiencing inflation rates that we have not seen since the early 1980s. This means our customers are paying more for the same basket of groceries they purchased last year,” said Davis, adding he hopes the federal government will continue to take steps to address the issue.
“The inflation in the Intermountain West is one of the highest in the country at approximately 9 percent,” Davis said. “It is estimated that households are paying $500 more per month to purchase the same goods and services as they did a year ago.”
While food retailers have generally done well during the pandemic, UFIA members are continuing to struggle with supply chain issues.
“Getting finished product is a challenge, and we are still seeing more holes in grocery store shelves than we are accustomed to,” Davis said.
Although out of stocks are higher than retailers would prefer, Davis said there is no imminent food shortage. “There is plenty of supply of most product, but flavors and varieties have decreased.”
Baby formula has been a major concern across the nation over the past year, with supplies severely diminished when the FDA closed the Abbott Sturgis, Michigan, facility. Davis said the supply issues have improved as the plant has come back online.
UFIA addresses concerns
UFIA offers resources to help its members. Davis said the association’s pharmacy committee has been meeting to discuss ways to get pharmacists to practice at the “top of their licenses.”
The committee has explored statutory and regulatory changes that could open a pathway to additional clinical work for community pharmacists, he said.
Also, UFIA has partnered with the Crimes Against the Statewide Economy unit to address organized retail crime in the state. The CASE unit was originally funded in part by the industry before receiving full public funding in 2022.
It has returned literally millions of dollars of stolen products to retailers across the state, Davis said.
Legislative activity
In this year’s state legislative session, Davis said one of the bills UFIA supported was the 2nd Sub. SB 176 – Alcohol Beverage Control Act Amendments. This was the annual omnibus alcohol bill that is run each year to address clean up and adjustments to Utah’s alcohol laws.
“This year’s bill had a couple of provisions that were very important to our retailers,” he said. “First, Utah’s current definition of beer excluded the possibility of retailers selling hard seltzers. Utah’s DABC was discussing the need to remove these seltzers from grocery and convenience store shelves in the event the definition of beer was not changed.
“Second, the bill initially had a proposal to increase the beer excise tax and then index it to inflation. Through some significant work over the interim period, the association staff was able to get a revised definition of beer into this bill that will preserve the hard seltzer market for our retailers. The staff was also successful in removing the beer excise tax provisions.”
The association also was successful in getting $500,000 in ongoing funding, which will support the CASE task force (retail crime focused unit) in perpetuity.
Other highlights included the association securing about $500,000 ongoing in state and matching federal funds for Medicaid medication therapy management, which will allow community pharmacists to be reimbursed for providing these MTM services.
Among legislation opposed by UFIA were bills that would have impacted employee/employer relationships and expanded the ability of employees to bring lawsuits against their employers.
“The association has generally opposed bills that expand employer liability or will incumber an employer’s ability to interact with their employees,” Davis said.
In this session, 6th Sub. HB 60 – Vaccine Passports Amendments, HB 202 – Employment Selection Procedures Act, HB 448 – Statute of Limitations Amendments and SB 117 – Utah Antidiscrimination Act Amendments would each have further impaired the ability for employers and employees to work together without the expanded opportunity for lawyers to get involved.
“When the legislature adjourned, none of these bills made it through the legislative process,” Davis said.
Annual conference
UFIA’s annual conference was held Aug. 9 at the Davis Conference Center in Layton, Utah.
Speakers included Leon Nicholas, WestRock VP of retail insights and solutions, who spoke on “Retail Re-Platformed;” and Utah State Rep. Robert Spendlove, who covered “Utah’s Hot Economy and the Labor Market Struggle.”
For more information, visit utfood.com.
To read more association news from The Shelby Report, click here.
