Economy slowing, but jobs expected in region

As economic indicators continue to point to a national recession, Colorado State University economists have updated their 2008 projections, predicting a further slowdown in Northern Colorado's economy.

Colorado State University economists Martin Shields and David Keyser issued revised employment forecasts in April that project regional job totals will grow 1.6 percent by year's end, translating into about 3,500 new jobs in Larimer and Weld counties. This is down from the 4,000 new jobs initially forecasted for 2008 in October.

Recent increases in unemployment have caught the economists' attention. Over the past year, the number of people out of work in Larimer and Weld counties swelled to nearly 14,000 — 2,200 more than a year ago.

Diverse employment sectors

Unlike the last local economic downturn in 2003 when high-tech manufacturing was devastated, no single industry is bleeding jobs.

No spike in mass layoffs has been reported, Keyser said. Instead, Keyser points out, "We are seeing instances where businesses are trimming a smaller number of workers across a variety of sectors."

For example, Kroll Factual Data cited mortgage market woes in announcing its layoff of about 15 Loveland-based workers in September. Thirty workers from the Fort Collins-based operations of Dako N/A, a bioscience firm, were laid off in August.

Shields and Keyser believe the region's diverse economic base will help protect the region from the national turbulence, even though multiple industry losses might be interpreted as a sign of widespread economic weakness.

In good times and in bad

Even in good economic times, some businesses lay off workers, Shields notes.

The forecast projects regional 2008 job growth will be strongest in the Leisure and Hospitality sector, with slightly more than 800 new jobs. The Natural Resources, Mining, and Construction sector is expected to add about 700 new jobs, buoyed by high energy prices and the growth of commercial construction.

After several years of job losses, the Manufacturing sector will add jobs, driven in part by the clean-energy industry. For example, Vestas' new wind blade manufacturing facility in Windsor is set to create 600 new manufacturing jobs in the region over the next two years, and Woodward Governor recently announced 100 new jobs in wind turbine inverters. Meanwhile, AVA Solar continues to ramp up both its research-and-development and production processes.

But not all sectors are projected to grow. Shields and Keyser foresee slight job losses in Professional, Scientific, Technical, and Business services and in the Information and Wholesale sector.

The revised forecast puts Northern Colorado's growth rate more in line with state-level projections, Keyser says. "In 2008, we expect the state to add 41,000 net new jobs, a 1.8 percent increase from 2007."

While the slowdown is not a surprise, the timing is. "We expected it, but it seems to be happening a bit sooner than we thought it would," says Shields.