Tag: Colorado

Eight of Top Ten States for Proved Oil Reserves Added Jobs at a Faster Annualized Rate than the U.S.

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Between 2007 and 2012, the annualized rate of change in U.S. wage and salary  employment was -0.6%.

Only 2 of the top 10 states for proved oil reserves were worse – California (-1.0%) and New Mexico (-1.0%).

Colorado (-0.2%) and Utah (-0.1%)posted slight annualized job losses. Wyoming (0.1%), Louisiana (0.1%), and Oklahoma (0.2%) experienced slight annualized job gains.

Texas posted annualized gains of 0.9%, Alaska was 1.1% and North Dakota was 3.7%.

Eight of the states grew at a rate faster than the U.S., while 6 posted positive gains.

The extractive industries played a key role in the growth of the economy during the recovery.

©Copyright 2011 by CBER.

Proved Oil Reserve Leaders have Lowered Their Unemployment Rate Faster than U.S., Except for Colorado and California

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In 2007 nine of the top ten states for proved oil reserves had an unemployment rate lower than the U.S. rate.

In 2012, nine of these top ten states had an unemployment rate lower than the U.S. rate, although the Colorado rate was lower by only 0.1 percentage points.

For the U.S., the gap between the 2012 and 2007 unemployment rate was 3.5 percentage points (8.1% – 4.6%).  The percentage point gap for the top 10 states with proven oil reserves is:

  • 5.1 California
  • 4.2 Colorado
  • 3.4 New Mexico
  • 3.1 Utah
  • 2.6 Wyoming
  • 2.4 Texas
  • 1.7 Louisiana
  • 1.1 Oklahoma
  • 0.9 Alaska
  • 0.0 North Dakota

In other words, the economies in 8 of the 10 leading oil reserve states experienced faster reduction in unemployment rates, presumably in part because of the growth in the extractive industries. California and Colorado are the exceptions. For the state of Colorado, it is reasonable to ask the question, “Is Colorado’s high gap a result of more stringent regulation and growing opposition to fracking?”

©Copyright 2011 by CBER.

Colorado – Leader in Extractive Industries

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About 94% of the U.S. proved oil reserves are located in 10 states, including Colorado. The state is ranked 9th with 423 billion barrels, well behind Texas, with 7,014 billion barrels.

Eighty-nine of the country’s 139 refineries are located in the top ten states for proved oil reserves… Sixty-two refineries are located in Texas, Louisiana, and California. Colorado has two refineries.

Colorado is a leader in the extractive industries, which has also made it a focal point for opposition to the industry.

©Copyright 2011 by CBER.

Will Colorado Output Continue to Expand as Slower Rate than U.S.?

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Between 1997 and 2012, the Private Sector Real GDP and job growth for Colorado outpaced the nation.  For this period, data released by the Bureau of Economic Analysis and the Bureau of Labor Statistics shows:

  • The annualized rate of growth for U.S. Private Sector Real GDP (sum of all states) was 2.3% and private sector wage and salary employment expanded at a rate of 0.5%.
  • The compound growth rate for Colorado Private Sector Real GDP was 3.1% and private sector nonfarm jobs grew at a rate of 0.9%.

More recently, the data tells a different story.  Colorado did not fare as well as the nation between 2009 and 2012.  While the rate of job growth was similar, U.S. output expanded at a faster rate.

  • The annualized rate of growth for U.S. Private Sector Real GDP (sum of all states) was 2.5% and private sector wage and salary employment expanded at a rate of 1.1%.
  • The compound growth rate for Colorado Private Sector Real GDP was 2.2% and private sector nonfarm jobs grew at a rate of 1.1%.

Time will tell whether the Colorado output will continue to grow at a slower rate than the U.S. or if this is a short-term variance that will reverse itself in 2013 or 2014.

Private Sector Real GDP
©Copyright 2011 by CBER.

State Per Capita Real GDP Increased by 1.1% Since 1997

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There are many data sets that can be used to evaluate the performance of the state and national economy. One of those metrics is Per Capita Real GDP. This measure is derived by dividing real output by the population.

For the period 1997 to 2012, Per Capita Real GDP for Colorado and the U.S. grew at essentially the same rate, 1.11% and 1.13% respectively.

Within that period there were some differences:

  •  Between 1997 and 2001 the Per Capita Real GDP for Colorado increased at an annualized rate of  3.88% compared to 2.49% for the U.S.
  •  Between 2001 and 2012 the Per Capita Real GDP for Colorado increased at an annualized rate of  0.13% compared to 0.64% for the U.S.
  • Between 2009 and 2012 the Per Capita Real GDP for Colorado grew at an annualized rate of 0.58% compared to 1.39% for the U.S.

During the final years of the go-go 90s, Per Capita Real GDP for the state increased at a faster rate than the nation.  Since the 2001 recession, the nation has outpaced the state.

©Copyright 2011 by CBER.

Colorado’s Dwindling Concentration of Manufacturers a Concern for the State

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Manufacturing is a critical part of Colorado’s economy.  Between 1998 and 2010 manufacturing employment decreased significantly in the state and the nation. Despite a slight rebound in jobs, Colorado’s concentration, or location quotient (LQ), of manufacturing workers has not bounced back.

A LQ is the local concentration of workers in a particular sector relative to the concentration in another area (typically the other area is the United States). If the local concentration is the same as the national concentration, the LQ=1.

The Colorado LQ for manufacturing is .645.

In December 2012:

  • 5.72% of Colorado employment was manufacturing
  • 8.87% of U.S. employment was manufacturing.
  • 5.72% / 8.87% = .645

Colorado has a lower concentration of manufacturing that the U.S. In short, this is important because many manufacturing jobs have higher than average pay. As well, segments of the manufacturing industry are critical components of the state’s high tech cluster.

For additional information on the state’s manufacturing sector check out Colorado Manufacturing Update Analysis of Employment Data Through 2012. It is available in the Special Reports section at https://cber.co.

©Copyright 2011 by CBER.

Colorado Adds 62,600 Jobs in Q1 2013

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A review of 22 NAICS sectors shows that on average, Colorado added 62,600 jobs in Q1 compared to the same period last year.  Only four of the sectors posted losses (Information 1,800; Federal Government 900; Natural Resources 600; and State (Not Higher Education) 100.

The following sectors added jobs at a faster level, Q1 2013 vs. 2012:
Accommodations and Food Services; B-to-B (Not Employment); Retail Trade;  Construction;  K-12 Education;  Wholesale Trade; Health Care; Arts Entertainment, and Recreation; and Other Services.

The following sectors added jobs at the same level, Q1 2013 vs. 2012:
Corporate Headquarters (MCE), Local (Not Higher Education), and State (Not Higher Education).

The following sectors added jobs at a slower level, Q1 2013 vs. 2012:
Private Education; Information; Employment Services; Transportation, Warehousing, and Utilities;  Higher Education; Financial Activities; Federal Government; Manufacturing; Professional, Scientific, and Technical; and Natural Resources and Mining.

While it is great news that most sectors are adding jobs, it may be cause for concern that many of the state’s primary job creators have fallen in the latter category – adding jobs at a level slower than 2012.

©Copyright 2011 by CBER.

Colorado Adds 51,800 Jobs in 2012 – Top Growth in Low Paying Sectors

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Colorado received good news today (3/18) when the Bureau of Labor Statistics released its benchmark revisions for 2012 employment. Overall 51,800 jobs were added, well above the 40,000 mark that the BLS reported in December 2012.

Growth was led by Accommodations and Food Services (AFS); Health Care; Professional, Scientific, and Technical Services (PST); B-to-B Services (Administrative and Waste Services), Employment Services, and Retail Trade.

The best news is that the PST sector added workers. This sector has many companies that are a critical part of the state’s advanced technologies cluster.  Overall, this sector has many occupations that pay above the state average.

The growth of the B-to-B Services and Employment Services are indicators of an improvement in the business sector.  Expansion in AFS, Retail, and Other Services sectors are an indication that consumer spending has improved. Unfortunately, each of these sectors have annual wages below the state average.

Only four sectors lost jobs. Three of the four were governmental sectors.

For additional details, see the “Review of the Colorado Economy – 2012”

Copyright 2011 by CBER.

General Assembly to Address Tough Fiscal Challenges and Contentious Social Issues

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Next week the gavel will drop for the 69th session of the Colorado General Assembly. Clearly, the legislature will have a number of tough fiscal challenges and contentious social issues to address in the upcoming session.

As part of its seminar series, on December 17th, the Colorado Office of Economic Development and International Trade (OEDIT) hosted a panel discussion to preview the upcoming legislative session. Panelists featured:

  • Danny Tomlinson, Tomlinson and Associates (Tomlinson provides periodic legislative updates on his website).
  • Jennifer Cassell, Legislative Liaison, OEDIT
  • Loren Furman, Colorado Association of Commerce and Industry (CACI)

The group identified the following as the top budget priorities for the state in the upcoming session.

  • Protect the last  and the least (human services)
  • K-12 and higher education
  • Economic development
  • Infrastructure
  • Public safety/Mental health
  • Improve efficiency of  state government/Pay increases
  • Expansion of Medicaid

As well, legislators will be asked to address the following issues.

  • Civil unions
  • Tuition for undocumented immigrants
  • Referendum on single-payer health insurance
  • Lobato school funding lawsuit
  • Metropolitan Transportation District
  • Tolling and/or VMT
  • HUTF money for transit
  •  RAMP (Responsible Acceleration of Maintenance and Projects)
  • Governmental immunity /raising of $600K caps
  • Peace officer bill of rights
  • Fracking
  • Renewable energy policy
  • Thermal standards
  • Eco-friendly architecture?
  • Coal bed methane
  • Public trustees and foreclosures
  • Gun control

It will be interesting to see if the Democrats act in the best interests of the state or for the well-being of their party, given that they control both houses and the governor’s office (That comment would also be appropriate if the Republicans were in a similar situation).

©Copyright 2011 by CBER.

Colorado Households Remain at Risk

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The Credability Consumer Distress Index (CCDI) shows that the financial condition of Colorado households has improved since the end of the recession, but they remain at risk. Colorado households are slightly better off than the nation.

The Index is a quarterly comprehensive picture of the average American household’s financial condition. It converts a complex set of factors into a single, easy to understand number. Financial distress is measured on a 100 point scale and a score under 70 indicates financial distress.

The index measures five categories of personal finance that reflect or lead to a secure, stable financial life—Employment, Housing, Credit, Household Budget and Net Worth. Each category has equal weighting.

90 and Above Excellent / Secure
80 – 89 Good / Stable
70 – 79 Weakening / At-Risk
60 – 69 Distressed / Unstable
Less than 60 Emergency / Crisis

From 1990 through 2002 the index was above 80; household finances were thought to be stable. From 2003 to 2008 the index dropped into the At Risk category. For seven quarters beginning in Q1 2009 the CCDI was in the unstable category. Since Q4 2011 the CCDI has been in the At Risk category. Coloradans fare better than the U.S. on the CCDI.

©Copyright 2011 by CBER.