Note to Editors: The full report is available with the news release at http://newsinfo.colostate.edu/
The number of new jobs in northern Colorado will grow 1.9 percent in 2008 and include a small boost in the struggling manufacturing sector after years of decline, Martin Shields, regional economist based at Colorado State University, said in a new economic forecast issued Thursday.
Shields, an associate professor of economics, spoke at the Colorado State University Regional Economic Summit and Forecast attended by 300 industry leaders, policy makers, economic development officials and educators at the Fort Collins Marriott.
Nearly 4,000 new net jobs could be added in Larimer and Weld counties in 2008 with growth rates varying across industries, according to Shields’ report, which he co-authored with David Keyser, research economist at Colorado State. Their research is funded through a partnership between the Colorado State University Office of Economic Development and the Northern Colorado Economic Development Corp.
Some of the region’s largest sectors – retail, health care, social assistance and manufacturing – are expected to experience only small gains in employment. Construction and finance, which have endured fast growth in recent years, will slow because of slower population growth and small increases in real household income.
Still, overall job growth will continue along with average population growth of 2.5 percent annually, Shields said.
"Right now, we’re cautiously optimistic," Shields said. "We expect employment gains again in 2009 and 2010 with about 5,500 jobs added each year – a 2.2 percent annual increase. But we are keeping a close eye on the national economy, which might slowdown notably over the next year or so, the effects of which would certainly be felt here."
Growth in services continues to drive the economy – the sector has accounted for about 60.9 percent of the net new jobs in Larimer and Weld counties since 2001. But high-paying sectors such as professional, scientific and technical services, finance and health care are expected to add jobs in 2008.
Additionally, Shields expects the downward slide in manufacturing jobs to end with the sector adding 138 jobs in 2008. The region lost 7,667 manufacturing jobs between 2001 and 2005.
Shields’ forecast of 1.9 percent growth in 2008 is slower than the 2.8 percent experienced in 2005-2006 – when 5,730 jobs were added – and the average 4.2 percent growth experienced in the 1990s. But the region has either outpaced or been in line with the Colorado and U.S. economies with relatively low unemployment
Regional unemployment stood at 3.6 percent in June 2007, a significant decline from its 10-year peak of 5.5 percent in 2003. By comparison, the state unemployment rate was 3.8 percent in June 2007.
"Things could be better, but they are not so bad," Shields said.
For the Northern Front Range, the labor force increased by 22,107 (7.9 percent) between June 2003 and June 2007, while the number of unemployed declined by 5,131, or 39.7 percent.
For 2005-06, the top five growth sectors in the region were accommodation and food services (878 new jobs); administrative, support, waste management, and remediation services (816 new jobs); health care and social assistance (785 new jobs); retail trade (527 new jobs); and mining (508 new jobs).
Within the region, differences emerge. Employment in Weld County, for example, grew faster than in Larimer County. Larimer County added 2,329 jobs between 2005 and 2006, a 1.8 percent increase, while Weld County added 3,401 jobs, a 4.3 percent increase. Since 2001, Weld County’s job count has grown by 8,822 positions, resulting in an 11.6 percent gain.
Wages, however, are not keeping pace with the increase in jobs. Since 2001, northern Colorado wages have only increased an average of $377 per year compared with an average increase of $421 per year statewide. In 2006, Weld County’s per capita income stood at $25,528, an 8.8 percent decrease since 2001. By comparison, Larimer County per capita income was $35,812, a 4.3 percent increase since 2001.
Sectors that are expected to grow throughout the region in 2008:
– Professional, technical, scientific and business services: 706 new jobs
– Natural resources, mining and construction: 590 new jobs
– Leisure (accommodation, food services and entertainment): 570 new jobs
– Retail: 476 new jobs
– Private education, health care and social assistance: 370 new jobs
– Finance, insurance and real estate: 370 new jobs
Shields also noted that northern Colorado’s clean energy cluster – a group of companies and organizations that clump together and attract additional companies and jobs – has had a substantial impact on the regional economy. In 2006, 33 firms and organizations employed 2,132 workers in the clean energy cluster. That’s an increase of 2.5 percent, or 53 jobs, since 2001 and an increase of 7.4 percent, or 152, jobs since 2005.
Shields points out that Colorado State University is increasingly important as the cluster grows. "Although the private sector is leading the charge, research partnerships including CSU have provided the region with important competitive advantages in the global energy economy," Shields said.
Shields is based in the economics department in the College of Liberal Arts at Colorado State and also serves the university’s Office of Economic Development. He issues regular reports on the economy and sectors in northern Colorado.