Colorado employers added jobs for the third month in a row, ending a streak going back to last fall of up and down hiring, according to a monthly update from the Colorado Department of Labor and Employment.
Colorado gained a net 4,700 nonfarm jobs in June, according to preliminary estimates, which followed a gain of 8,600 jobs in May and 6,100 in April. After a weak first quarter where only 600 jobs were added, the state added 19,400 in the second.
Over the past year, employers in the state have added 42,400 jobs on a seasonally-adjusted basis with two sectors dominating. Local governments have added 19,500 jobs and leisure and hospitality is up by 25,000, mostly because of strong hiring at restaurants and more recently at hotels.
“We are starting to see a strong rebound in hotel employment. Travel is coming back,” said Ryan Gedney, a senior labor economist with the state on a news call Friday morning.
For the month, leisure and hospitality added a net 1,700 jobs, while local governments and manufacturers added 1,400 each. The biggest monthly losses came in trade, transportation and utilities, down 1,000 jobs, and in information, down 800 jobs.
The state’s seasonally-adjusted unemployment rate held steady at 2.8% in June and remains significantly below the U.S. rate, which fell from 3.7% in May to 3.6% in June.
Despite continued rate hikes from the Fed, a regional banking crisis in March, and heavy layoffs in the tech sector this year, unemployment hasn’t risen, said Scott Anderson, chief economist with the Bank of the West.
“I believe much of our economic fate will turn on that labor market resilience holding up. One cannot forecast a ‘soft’ landing or ‘no’ landing for the U.S. economy without it,” he wrote in an email note Friday.
But Colorado’s 1.5% rate of annual job growth remains substantially behind the 2.5% pace nationally. And Broomfield economist Gary Horvath notes that of the 20,000 nonfarm jobs added in the first half of the year in Colorado, only 9,600 came from the private sector.
It remains too soon to say if a recession has been averted. But the state’s labor market still remains tight despite much higher interest rates.
Tamra Ryan, the Coors Fellow for Economic Mobility at the Common Sense Institute and CEO of the Women’s Bean Project, said in a report this week that the state’s labor force is the tightest on record, with 2.7 jobs for every unemployed person.
Labor shortages combined with skill mismatches are costing the state an additional $46 billion a year in GDP or output each year, she estimates. That 10% underperformance can’t be addressed solely by adding to its population via migration, especially of skilled workers, a strategy the state has relied on in the past, Ryan said.
More robust vocational training programs and educational initiatives are needed, as well as improved childcare access. Also, more needs to be done to recruit marginalized groups like the disabled and the formerly incarcerated, she said.
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