A six-month streak of job gains in Colorado ended last month and more losses are expected as tighter restrictions to combat a rising wave of COVID-19 infections start to weigh more heavily on the economy.
“The economy stalled abruptly. It is like running a marathon and hitting the wall at mile 21,” said Broomfield economist Gary Horvath. He predicts more job declines will come in December and into the first quarter, adding “there are problems with our economy that cannot be fixed overnight.”
Nonfarm jobs in the state declined by 6,900 between October and November on a seasonally-adjusted basis, marking the first time employment fell since April, when 325,800 jobs were lost, according to a monthly update from the Colorado Department of Labor and Employment. Private-sector employment decreased by 5,900, while government employment fell by 1,000 jobs.
Employers were surveyed on the week that includes Nov. 12, ahead of the stricter Level Red restrictions that came down in Denver and 14 other counties on Nov. 20, said Ryan Gedney, a senior economist at CDLE. Most of the weakness in hiring in November came from outside the northern Front Range, with hiring for the winter tourism season much less robust than in past years.
“If you look at the metro areas, it seems positive. It is the balance of the state that shouldered those job losses,” he said.
Foreshadowing even bigger losses down the road, requests to receive unemployment benefits have surged since the middle of November as restaurants lost indoor dining and hotels saw bookings reverse course.
The state unemployment rate remained unchanged at 6.4%, the third month it has stayed there. San Miguel (11.2%), Pitkin (10.2%), Huerfano (8.7%), Pueblo (8.3%), and Eagle (7.8%) counties had the highest unemployment rates in the state last month.
The biggest monthly job losses on a seasonally-adjusted basis in November came in leisure and hospitality, down by 6,400 jobs; education and health services, down by 3,800; and financial activities, down by 2,000. The sectors with continued momentum were professional and business services, up 3,300 jobs, and trade, transportation and utilities or TTU, up by 1,100.
Retailers ramped up hiring for the holiday season and distribution facilities hired more staff to help with the crush of online orders, boosting the counts in trade and transportation.
Colorado gained jobs in January, suffered unprecedented losses from February to April, and then was gaining them back until November. Of the 342,300 nonfarm jobs lost during the first wave of the pandemic, the state has managed to recover 209,600, which represents a recovery rate of 61.2%. Gedney said that exceeds the U.S. recovery rate of 55.6%.
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