Colorado’s population is growing at its slowest pace on record, with domestic net migration turning negative last year and the population declines long seen on the Eastern Plains taking hold in one large Front Range county.
Time will tell if the slowdown is temporary, as state demographers predict, or the start of a new trend. But Colorado’s ability to attract newcomers carries huge implications for its economic future, from filling open jobs to providing care for the surging number of older residents.
“If we don’t see population growth, if we don’t see that net migration, we will absolutely have a decline in our working-age population,” said Colorado State Demographer Elizabeth Garner at the 2023 State Demography Summit, which was held this month in Littleton.
Colorado gained 26,442 residents in the 12 months through July 1, 2021, and another 27,710 through July 2022, according to the demography office’s Vintage 2022 Population Estimates. Last decade, population gains averaged above 70,000 most years with a peak gain of 98,939 in 2015.
“We are seeing the lowest growth rates on record for Colorado,” said Cindy DeGroen, the state’s projections demographer.
Over the last two annual counts, the rate of population growth in Colorado has been running closer to 0.5%, under a fifth of the 2.5% rate averaged in the 1990s. But DeGroen expressed optimism that growth would rebound, getting back above a 1% rate in the middle of this decade and holding there until at least 2035.
“We do anticipate an increase from those record low rates back to where we would have been prepandemic,” she said.
For that to happen, net migration will need to rebound and stay strong for the remainder of the decade. Migration is needed because not enough children will be born in the state to compensate for the rising number of deaths expected in the decades ahead.
Between 1970 and 2020, net migration, the difference between those moving in and those moving out, averaged 40,000 people a year in Colorado’s favor. Between 2022 and 2032, the demography office forecasts that it will average 42,000 people a year before slowing due to slower population gains both nationally and internationally.
Net migration in Colorado last year was 14,924, but international migration drove that. Colorado lost 9,324 people to domestic migration, the movement of people from state to state.
Colorado still is attracting Californians, with a net gain of 13,243, and continues to hold the upper hand in drawing residents from New York, Idaho, Illinois and Virginia.
It lost residents to all adjacent states — Wyoming, Utah, New Mexico, Oklahoma, Kansas, Nebraska and Arizona — as well as many southeastern states, including a net outflow of nearly 10,000 people to Florida.
Forecasting international migration, which is tied to conditions in the countries that send out migrants, as well as immigration and border policies that can change from administration to administration, can be complicated.
“The number one factor of uncertainty is the international migration number,” Garner said. The flow of refugees to the state has increased from places like Afghanistan and Venezuela.
Colorado is a second-tier state, meaning it isn’t a typical entry point for those arriving from abroad like California, Texas, New York and Florida are, she said.
Forecasts of a rebound in net migration assume Colorado can maintain strong job growth, which the state has struggled to do this year. Advances in automation and artificial intelligence have the potential to displace large numbers of workers in higher-paying fields. But more manufacturing is returning to U.S. shores, which could boost growth.
The forecast also assumes Colorado retirees age in place and don’t cash out the huge pile of home equity they have built up in recent years and move to somewhere warmer and more affordable.
Higher housing costs make Colorado less attractive to young adults looking to relocate to start their careers as well as the companies looking to hire them. And it hinders the ability of those transplants, not to mention natives, when it comes time to start a family.
Colorado is now home to the four most expensive metro housing markets outside a coastal area — Boulder, Denver, Fort Collins and now Greeley, according to the real estate research firm Zonda. But one upside of slower population growth is that the state has chipped away at its housing deficit, which fell from around 127,000 units in 2019 to 101,141 in 2021, according to a study from the advocacy group Up for Growth.
“We have been on a big bull market (in construction) since we came out of the Great Recession. Did we sell so many homes between 2017 to 2022 that we borrowed from future demand?” asked Ted Leighty, CEO of the Colorado Association of Home Builders, while speaking on a housing panel at the demography summit.
When it comes to categories like luxury apartments in downtown Denver, too much supply might be a short-term problem. But Phyllis Resnick, executive director and lead economist of the Colorado Futures Center at Colorado State University, argues housing demand could remain strong for years to come, preventing home prices and apartment rents from getting aligned with incomes.
Millennials, the largest generation in the state, are aging into homeownership, with just over half owning a home, contrasted with a homeownership rate of 74.1% for Gen Xers and 81.2% for Baby Boomers. Millennials are starting families and buying homes at a later age, which will provide a source of home-buying demand for years to come.
And although it doesn’t get discussed as much, high housing costs have also pushed more households to double up. There are about 680,000 unique households hidden within primary households, Resnick estimates.
“We have folks in this state who are really stressing. They are living on the edge of economic stability and are the ones struggling the most to be stably housed,” she said.
Another important trend remains the aging of the population. Assuming migration can get back on track, over half of the population gains expected this decade will come among those aged 65 and over. The next biggest surge will be among those aged 25 to 44. The number of residents aged 0 to 17 is expected to fall.
If high home prices and a lack of jobs keep young people away, then almost all of the state’s population gains this decade will come in the 65-plus category. In the next five years, 200,000 workers in the state are expected to retire and Colorado will need new workers to fill those vacancies, on top of the jobs being added as the economy expands.
Jefferson County provides a foreshadowing of impacts on what the state’s aging population might look like. Although counties across the Eastern Plains have long struggled with population losses, they have now shown up in heavily populated Jeffco, which has lost an estimated 7,000 people since 2020.
Although out-migration can explain some of the shrinkage, Nancy Gedeon, a demographer with the state, said the county has an older population, adding point blank that deaths are driving the decrease.
The municipalities adding the most residents last year were Windsor, Colorado Springs, Erie, Castle Rock and Boulder. In percentage terms, Keensburg was the state’s fastest-growing municipality with a 19.4% rate of growth, followed by Mead, Deer Trail, Severance and Tinmath,
Greeley and Commerce City, despite being much smaller, both added more residents than Denver, which had a 0.2% growth rate.
DeGroen predicts that the state’s current population of 5.8 million will reach 7.5 million by 2050. Starting around 2030, the state will begin to see a rapid decline in its natural increase, or births minus deaths, leaving it even more dependent on migration.
Of the 1.7 million people the state is forecast to add between 2020 and 2050, 1.5 million will be located along the Front Range, with 54% of population gains going to metro Denver and Boulder; 26% to Weld and Larimer counties, and 20% along the southern Front Range, primarily El Paso County.
The Western Slope is expected to gain 170,000 residents by 2050, with Mesa, Garfield and Eagle counties the biggest gainers.
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