Colorado’s economy slowed along with the rest of the country in the first half of the year, but it continues to perform better on a variety of measures, according to the Quarterly Business & Economic Indicators from the Colorado Secretary of State’s Office and the University of Colorado Boulder.
Two negative quarters of U.S. GDP and high inflation could signal a recession is underway or around the corner, although an official declaration hasn’t been made yet. Still, things are definitely slowing.
“The report paints a picture of a moderating economy both in Colorado and nationally,” said Rich Wobbekind, a senior economist with the Leeds Business Research Division at CU, during a news briefing on Thursday.
Yet, when it comes to GDP growth, income growth, labor force participation, employment gains and home price appreciation, Colorado continues to bat above average, putting it in a better spot to weather any downturn.
For example, the state is on track to add 104,000 jobs this year, per estimates from the BRD, and that isn’t usually what happens in a recession. After losing 375,200 jobs from February to April 2020, the state has regained 412,300 jobs, which ranks as the 10th best recovery in the country.
Four industries, however, haven’t fully recovered — government; mining; education and health services; and leisure and hospitality. And Weld County continues to lag behind the rest of the state in its recovery.
The state’s labor force stands at a record level, growing 2.6% year-over-year in June. And the labor force participation rate, a measure of how many adults are working or actively looking for work, ranked second-highest of any state in June at 69.5%.
Colorado’s real GDP rose at an annualized rate of 3.9% in the second quarter after a 1.9% decline in the first quarter. By contrast, U.S. GDP fell at an annualized rate of 0.9% in the second quarter.
The quarterly report primarily focuses on the number of business filings made with the state. New filings represent a sign of optimism about the future, and those were down 0.2% year-over-year. Requests to dissolve a business are a measure of stress, and those surged 27%.
There were 157,021 new business filings of all types in the second quarter versus 157,297 filings in the second quarter of 2021. The number of existing business renewals, a mark of business stability, rose 11% from 154,995 in the second quarter of last year to 172,106 this year.
The number of businesses and nonprofits who went delinquent, meaning they didn’t make their annual filing with the state, rose by 9.8% year over year.
“While Coloradans’ resilience has been tested, today’s report shows we’re moving in the right direction. Colorado’s economy continues to shine even with uncertainty in the national economy. Our business sector has shown ongoing resilience,” said Jena Griswold, Colorado Secretary of State.
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