Colorado’s economy needs to add another 6,100 jobs to regain employment counts seen right before the pandemic started, and that full recovery may have happened in February, according to an update Monday from the Colorado Department of Labor and Employment.
The state lost 374,500 jobs between February and April of 2020 as consumers and businesses pulled back and state and local governments ordered lockdowns and other measures to control the spread of the novel coronavirus. Between May 2020 and January of this year, employers had restored an estimated 368,400 jobs, leaving another 6,100 to go, said Ryan Gedney, a principal labor economist with the CDLE.
Employers in the state managed to add a net 6,700 nonfarm jobs between December and January and Gedney said it is likely they added enough last month to restore any of the remaining gap. Last month’s employment report will be released on March 25.
Colorado’s job recovery rate of 98.4% in January ranks 11th highest among states and is ahead of the U.S. job recovery rate of 86.9%. When it comes to the private sector, the job recovery in the state is 103.1%, which surpasses the 89.8% recovery rate seen nationally, Gedney said.
Economists had predicted a slightly slower employment recovery, but annual revisions to employment counts revealed hiring was much more robust last year than initially estimated, narrowing the recovery gap, and putting most sectors at beyond or near full recovery — with three exceptions.
Government employment levels are still down by 17,300, due primarily to losses in local education. The public sector continued to lose jobs on a net basis even after the economy opened up in May 2020. Leisure and hospitality suffered devastating layoffs as travel ground to a halt and has been more sensitive to the various waves of variants and needs to add another 16,900 jobs to get back to even.
The biggest percentage gap remains in the mining sector, which includes oil and gas production. It took a big hit in early 2020 as commodity prices cratered. Employment in that relatively small sector is off by nearly 7,000 or more than a quarter of pre-pandemic levels.
That explains why metro Greeley, which includes Weld County, the state’s top oil-producing county, has only recovered 44% of the jobs lost during the pandemic. Grand Junction, by contrast, is leading the state with a job recovery rate of 124%, followed by Colorado Springs at 113%. Denver and Fort Collins are near full recovery. And the 47 counties outside a metro area are at a 101% recovery rate, Gedney said.
While the job counts are nearly back to pre-pandemic levels, the state’s unemployment rate of 4.1% is higher than the 2.8% rate seen in February 2020. One reason for that is the growth in the labor force over the past two years.
Colorado’s unemployment rate ranks 26th among states, tied with West Virginia and Maine, and it is moving closer to the U.S. unemployment rate, which was 4% in January. Another reason the state ranks higher on unemployment is that its population is participating in the labor force at one of the highest rates in the country, Gedney said.
Construction was the top gainer in January, with 2,000 jobs added. Professional and business services added 1,900 jobs; trade, transportation and utilities added 1,100 jobs; and manufacturing added 1,000 jobs.