Private-sector employers in the state failed to grow their payrolls in January, a disappointing start to the new year, but revisions show the state’s unemployment rate was much lower than first thought in 2022, according to a delayed update from the Colorado Department of Labor and Employment.
Employers added 800 jobs in January, but those came entirely from the public sector, and they represented a sharp comedown from last year’s average of 5,225 jobs added a month. Educational and health services added 2,200 jobs, while professional and business services added 1,300 on a seasonally-adjusted basis. But on the other side of the teeter-totter, financial activities lost 1,300 jobs and construction lost 1,100.
“Weather could have been a factor in the lack of job growth. It was a cold and snowy January,” said Ryan Gedney, a senior economist with the CDLE, during a news call on Monday.
Construction hiring is especially vulnerable to bad weather, but something bigger could be at play. The number of construction job openings nationally plummeted by 240,000 in January, or by nearly half the levels seen in December, according to a report from the Associated Builders and Contractors. The big chill could be coming from a tougher lending climate, not from the ambient temperature.
“About half of the sectors posted declines, and there was weak job growth in most other sectors. The most notable areas of concern were financial activities and construction. These declines are likely, based on real GDP and employment data and the headwinds they are facing,” said Broomfield economist Gary Horvath, who described the January numbers as disappointing.
Better news came on the state’s unemployment rate following an annual benchmarking process. Colorado’s unemployment rate had run close to the U.S. average last year and the state ranked in the middle of the pack among states month after month, which was a departure from its pre-pandemic showing among the 10 states with the lowest unemployment rate.
Rather than the 3.6% unemployment rate averaged across 2022 in initial estimates, the state average was 3% following revisions. January’s rate was 2.8%, which matched the revised rate seen in December, which has been initially pegged at 3.2%.
“With Colorado’s unemployment rate dropping below three percent, it is clear that Colorado is the best place to live, work, and do business. More entrepreneurs are starting businesses in our state and we are outcompeting other states for businesses and jobs,” Gov. Jared Polis said in a release touting the lower numbers.
Revisions placed Colorado with the ninth lowest unemployment rate in the U.S. in January, tied with New Hampshire. December’s count of unemployed workers, initially estimated at 106,745, was revised to 89,130. In January, the count was at 96,700.
The payroll jobs added also varied by a significant amount, going from 8,725 to a still respectable 5,225 per month average gain following revisions. The state’s labor force participation rate, a measure of how actively working-age adults are working or looking for work, wasn’t as high as first thought in 2022. It adjusted from an annual average of 69.2% to 68.4%.
