For businesses and wage-earners across Colorado, the economic good fortune news continues. The most recent data from the Bureau of Labor Statistics shows that Colorado’s private sector wage growth increased by 4.4 percent in 2017, compared to the prior year. The state was projected to be on track to add 70,100 jobs through the first half of 2018, a number that has surprised state economists; adding jobs at this rate was not considered possible when Colorado economists prepared their 2018 forecasts in January.
Colorado wage growth is partially responsible for the increase in job growth in 2018, according to Colorado-based Business and Economic Research ( http://cber.co). Private sector wage growth was up 4.4 percent in 2017 over the same period of 2016. In June 2017, the state unemployment rate fell to 2.7 percent, compared to 4.0 percent nationally.
The combination of some of the lowest unemployment statistics in Colorado history, coupled with strong wage growth, has encouraged workers on the sidelines to begin looking to re-enter the labor force.
Accommodations and food services categories led Colorado’s strong job growth, followed by strength in construction; professional, scientific and technical services; and the healthcare sector.
At the same time, state and national economists are paying close attention to inflation rates, which can quickly eat up any real wage gains. U.S. inflation, as measured by the seasonally adjusted Consumer Price Index, is forecast to increase by 2.3 percent this year. This is slightly above the Federal Reserve’s target rate of 2.0 percent.
Economists from the Colorado Economic Review say that increases in 2018 will be a result of higher interest rates, housing costs, health care costs and gasoline prices. The increase in the June CPI rate was 2.8 percent. The average inflation rate for the first half of 2018 is 2.5 percent.
Economists at Colorado Economic Review (https://cber.co/economic-updates/ ) are now projecting that economic growth in Colorado will continue into 2018, barring the impact of national events such as political unrest and the impacts of trade wars and tariffs, which could affect some key industries.
Recent Annual Rates of Inflation
|Year||Rate of inflation in percentage year-over-year|
Chart Source: Colorado-based Business and Economic Research http://cber.co