FEW things excite Gary Herbert, the Republican governor of Utah, more than trashing his own line of work. “Every sector is growing here except for one,” he says triumphantly. “You know which? Government!” He is right; private-sector employment in Utah grew by 4.5% in the year to July. Only the public sector shrank.

Unlike other states that have been piling on jobs, such as California, Utah is not merely rebounding; at its January 2010 peak unemployment was still well below the national average (see chart). Today it stands at 4.6%, the fifth-lowest rate in the country. And the diversity of Utah’s recovery, sniffs Mr Herbert, contrasts with the energy-fuelled boom of other low-unemployment states, like North Dakota.

Success has bred confidence; local boosters speak of the “Wall Street of the West” in Salt Lake City, anchored by a big Goldman Sachs office, or the “Silicon Slopes” around Lehi, half an hour south, where technology firms have begun to cluster. Google chose nearby Provo, one of America’s fastest-growing cities, as one of three pilot sites for its fibre-optic broadband network. Employers like Utah’s skilled workers (particularly young Mormons who learn languages on missions abroad) and its enterprising universities.

Even the state motto is “industry”

The handsome 1,100-worker Lehi campus built by Adobe, a digital publishing and marketing company, is a particular point of pride. Eye-catching murals adorn the walls; employees relax in breakout rooms with pool tables and vintage video games. Brad Rencher, an Adobe executive, says myths have been bust about Utah; potential recruits who once feared bad coffee and uptight Mormons now come for the hiking and skiing. Four miles away Stan Lockhart at IM Flash, a chipmaker, enthuses that the state government knows what business needs.

Indeed, Utah and its cities regularly top national rankings of business-friendliness. Officials gush about low taxes, wages and energy costs, light regulations and enterprising spirits. All this, along with some generous tax sweeteners, has seduced the likes of Boeing, Procter & Gamble and eBay into the state. “We really value capitalism,” says Spencer Eccles, head of the governor’s economic development office.

Yet it is a peculiarly cuddly form of capitalism. Income inequality is lower in Utah than any other state, and a recent Harvard/Berkeley study found that economic mobility was higher in Salt Lake City than in any other big American city. “People here aren’t trying to be Donald Trump,” says Stephen Kroes, president of the Utah Foundation, a think-tank. Thanks partly to the Mormon influence, Utahns volunteer more than anyone else.

Being small and homogenous probably helps; but that is changing. Between 2000 and 2010 Utah’s Latino population grew three times quicker than the state overall. They are now 13% of Utahns, and some areas are majority-minority. Some of Utah’s schools are struggling to cope: the high-school graduation rate among minorities is dreadful. Skeletal education budgets do not help; per-pupil spending has been lower than in any other state since 1988, according to the Utah Foundation.

Utah’s sky-high birth rate helps explain that; it must find an extra $75m a year just to keep up with swelling school rolls. But in neighbouring Colorado and Nevada, both swing states with higher Latino concentrations, lawmakers have seriously debated raising taxes to fund schools. In one-party Utah, by contrast, politicians with ambition speak of taxes only when they want to lower them. (Earlier this year a Republican state senator violated that rule and found himself all over the front pages.)

Businesses like the predictability of stable government, but there may be losers, too. In budget battles, says James Wood at the University of Utah, transport usually beats education. The state’s schoolchildren perform better than funding levels alone would predict. Still, Mr Herbert acknowledges the need for more money, so long as it comes from the proceeds of growth rather than new taxes.

Utah has enjoyed good luck as well as strong leadership. Like its neighbours, it has benefited from natural-resource wealth, plenty of cheap land and proximity to big population centres in California; unlike them, its biggest demographic challenge has been accommodating toddlers rather than minorities. That is changing, and Utah’s leaders will have to adapt.