A surplus of new employment opportunities could be heading for Northern Colorado in 2007, according to a recent report.
The anticipated 2.8 percent growth for 2007 is just slightly higher than the 2.6 percent growth that occurred in the region in 2005. It would be the fastest expansion the region has undergone since the 2001 recession.
The forecast for Larimer and Weld counties this year calls for 6,100 new jobs, according to a quarterly report released coauthored by Martin Shields, an associate professor and regional economist at CSU, and David Keyser, a research economist at CSU.
The Northern Colorado region has the second largest labor force in Colorado, just behind the Denver Metropolitan Area to the south, according to the Northern Colorado Economic Development Corporation.
Larimer and Weld counties can expect to see an increase of 1,000 jobs in private education and the health service industry, as well as 1,200 new jobs in the leisure and hospitality sector, with most of those positions opening up in restaurants, according to the report.
“Many companies in Fort Collins act as both local and export sectors because this city is a destination for gourmands who live and work outside of the city,” Keyser said. “There are also over 25,000 college students here for most of the year, many of whom are spending their parents’ money, scholarship funds, or money that they earned outside of the city. Businesses heavily patronized by these students will act as export sectors as well, leading to a concentration that is greater than the national average.”
Since November 2005, the labor force in Fort Collins has increased by nearly 3,000 people, while the number of unemployed has decreased by around 500, according to the Colorado Department of Labor.
“The health care sector is an increasingly important economic driver, and the new Medical Center of the Rockies in Loveland will certainly contribute to services growth in this region,” Shields said.
The unemployment rate in Larimer County was at 4.1 percent in September 2006, down from 4.4 percent in 2005, according to the NCEDC.
Although most sectors in Larimer County experienced growth between 2005 and 2006, there were some areas that saw considerable loses.
Computer and electronic product manufacturing lost 826 jobs.
In 2006, the number of workers in that industry fell by 43 percent. This deals the most significant blow to the economy of Larimer County, since the average annual income per worker in this sector were more than $76,000 in 2005, according to the report.
“Northern Colorado lost a lot of good-paying jobs in this industry over the past five years, with losses concentrated in only a few companies,” Shields said. “This shows the importance of diversification when the economy runs into some rough spots.”
Another area of concern for Shields is the retail sector.
“With Centerra and several proposed new developments, it will be interesting to see at what point regional retail becomes saturated,” he said.
A new component of the Colorado economy is the increase in minimum wage that went into effect on Jan. 1. Colorado voters approved Amendment 42 in November and increased the minimum wage from $5.15 to $6.85. The minimum wage for tipped employees increased to $3.83.
The change in minimum wage won’t have a major effect on the economy, Shields said.
“Increases in minimum wage have little, if any, impact on employment demand,” Shields said. “Instead, price increases get passed on to consumers. As a result, consumers have to pay more for goods and services, reducing overall economic activity somewhat; but workers get paid more, enhancing their own ability to make purchases, hence increasing overall economic activity.”
Maren Williams, a sophomore English major who works at the CSU bookstore, said she thinks the minimum wage increase will help families and people who rely on minimum wage jobs to live.
“There are always going to be reasons why you shouldn’t do something, but the increase still is not very much, I mean, now people can buy an extra dinner at Chipotle,” she said. “It’s never going to be equal, but as long as it’s more equal.”
The report also takes a look at population growth in the region, along with new housing developments.
Since the surge in construction of new residential buildings in Northern Colorado from 2000 to 2005, housing development has slowed considerably. However, estimates from the Colorado Department of Local Affairs show that the region’s population surpassed one-half million people for the first time in 2005.
“Demographic experts have predicted that a large part of the projected population increase in this region will be retirees, especially Baby Boomers,” Keyser said. “This group will take advantage of the region’s many recreation opportunities, as well as excellent health care, and a relatively low cost of living when compared to Denver.”
Keyser said this will create even more jobs, especially in areas that cater to retirees.
The U.S. Department of Commerce reported that the per capita income in Larimer County in 2005 was $34,219, not far from the national average of $34,586.
Staff writer Bob Shipton can be reached at firstname.lastname@example.org.