colorado.edu/business/brd

colorado.edu/business/brd

Big Changes, Unknown Impacts Southwest Business Forum Place cover image here Richard Wobbekind Senior Economist and Associate Dean for Business and Government Relations January 11, 2018

Colorado Population, Employment, and Prices

Colorado Change in Population Thousands 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 Change in Colorado Population 2000-2018 2000 2006 2012 2018 Net Migration Natural Increase Colorado s population increases 91,500 in 2017 90,600 in 2018 7th-fastest state for percentage growth 8th-fastest state for absolute growth 88% of growth along Front Range Continued net migration into the state Source: Colorado Demography Office.

Colorado Employment Growth Jobs Added Thousands 100 80 60 40 20 0-20 -40-60 -80-100 -120 56,330 47,100 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Sources: Colorado Department of Labor and Employment and the Colorado Business Economic Outlook Committee.

State Employment Growth Year-over-Year November 2017 Source: Bureau of Labor Statistics (Seasonally Adjusted).

Regional Employment Growth and Unemployment Employment Growth Rate, November 2017 YoY Greeley Colorado 1.7% Unemployment Rate November 2017 Greeley Colorado 2.9% Fort Collins-Loveland Fort Collins-Loveland Boulder Boulder Denver-Aurora-Broomfield Denver-Aurora-Broomfield Colorado Springs Colorado Springs Pueblo Pueblo Grand Junction -1 0 1 2 3 4 5 Percentage Grand Junction 0 2 4 6 Percentage Sources: CES (Seasonally Adjusted) and LAUS (Not Seasonally Adjusted).

Employment In Current Decade National, State, and Local Percent 40% 35% 30% 25% 20% 15% 10% 5% Greeley Ft. Collins-Loveland Denver Boulder Colorado Colorado Springs National Pueblo Grand Junction 0% -5% 2010 2011 2012 2013 2014 2015 2016 2017 Source: Bureau of Labor Statistics (Seasonally Adjusted).

Colorado Employment Change 2018 Forecast Employment in Thousands 2,710 2,700 2,690 2,680 2,670 Professional Business Services Trade, Transportation, Utilities Education, Health Services Leisure and Hospitality Construction Government Financial Actvities Other Manufacturing Total jobs gained: 47,100 Mining and Logging Information 2018 2,660 2,650 2017 Source: Bureau of Labor Statistics, Current Employment Statistics (SA).

Colorado Wages 2016 Sector Total Employment YoY Employment Growth Wages YoY Wage Growth Mgmt of Companies and Enterprises 36.7 0.3% $128,275-9.9% Mining and Logging 23.7-22.8% $114,630-0.1% Utilities 8.2 0.0% $95,715 2.6% Information 71.7 1.4% $95,511 1.4% Professional and Technical Services 210.1 2.7% $90,437 1.8% Finance and Insurance 113.4 2.5% $90,007 2.3% Wholesale Trade 105.1 1.6% $79,510 0.5% Manufacturing 142.5 1.1% $66,329-0.2% Construction 155.1 4.2% $57,344 3.6% Real Estate and Rental and Leasing 50.2 3.7% $54,984 3.6% All Industries 2,599.2 2.3% $54,664 0.9% Government 427.3 2.4% $53,556 2.2% Transportation and Warehousing 72.9 1.8% $53,090 2.4% Health Care and Social Assistance 286.9 4.1% $48,801 1.3% Educational Services 39.8 3.4% $39,361 1.2% Administrative and Waste Services 158.5 0.8% $38,771 2.9% Other Services 105.2 2.1% $38,204 1.9% Arts, Entertainment, and Recreation 52.5 3.3% $36,072 2.0% Retail Trade 268.6 2.1% $30,625 1.8% Accommodation and Food Services 270.8 3.4% $20,996 3.0% Sources: Colorado Business Economic Outlook Committee and Bureau of Labor Statistics, Quarterly Census of Employment and Wages.

Photo courtesy of Luke Gubbels. Agriculture

Gross Farm Revenue and Net Income 2008-2018 $ Millions 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 Net Income Gross Revenue Farm Production Expenses $8.0B $ Millions Net Farm Income 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 $1.4 B 2008 2010 2012 2014 2016 2018 0 2008 2010 2012 2014 2016 2018 Source: Colorado Business Economic Outlook Committee.

Livestock Cash Receipts 2008-2018 $ Millions 6,000 5,000 4,000 $4.7B Beef is the largest share Cattle feeders had a prosperous year 3,000 Potential NAFTA impact Labor Shortages 2,000 Dairy herd and milk production are up 1,000 2008 2010 2012 2014 2016 2018 Source: Colorado Business Economic Outlook Committee.

Crops Cash Receipts 2008-2018 $ Millions 3,000 2,500 2,000 1,500 $2.1B Lack of labor to harvest crops: If You Plant It, Who Will Harvest It? Sectors experiencing growth: grapes, hemp, greenhouses, and nurseries Price of crops lower than cost of production 1,000 NAFTA renegotiations and results will affect agricultural exports 500 0 2008 2010 2012 2014 2016 2018 Farm consolidation and loss of business in rural communities expected in 2018 Source: Colorado Business Economic Outlook Committee.

Natural Resources and Mining

Crude Oil Production 2008-2018 Largest Producers (July 2017) 1. Texas 2. North Dakota 3. California 4. New Mexico 5. Oklahoma 6. Alaska 7. Colorado 8. Wyoming 9. Louisiana 10. Kansas Millions of Barrels 140 120 100 80 60 40 115 20 0 2008 2010 2012 2014 2016 2018 Sources: Rankings from the Energy Information Administration. Production data from Colorado Geological Survey Mineral and Mineral Fuel Activity Reports, Colorado Oil and Gas Conservation Commission, Department of Minerals and Geology, and Colorado Business Economic Outlook Committee.

Natural Gas Production 2008-2018 Billions of Cubic Feet 1,700 1,650 1,600 1,550 1,500 1,450 1,670 Fifth-largest producing state Projected price higher due to colder temperatures Prices in Colorado in 2017 were the 11 th lowest in the country Total production flat due to low prices Value of production to increase slightly 1,400 2008 2010 2012 2014 2016 2018 Sources: Colorado Geological Survey Mineral and Mineral Fuel Activity Reports, Colorado Oil and Gas Conservation Commission, Department of Minerals and Geology, and Colorado Business Economic Outlook Committee.

Value of Natural Resources 2008-2018 $ Millions $20,000 $18,000 $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $14 B Coal Minerals CO2 Natural Gas Crude Oil $0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Sources: Colorado Geological Survey Mineral and Minerals Fuel Activity Reports, Colorado Oil and Gas Conservation Commission, Department of Minerals and Geology, and Colorado Business Economic Outlook Committee.

Renewables One of the most ambitious renewable energy portfolios Includes wind, solar, hydro, geothermal, and biomass 21.5% of net generation in 2016 Colorado ranks 10 th nationally for wind capacity Colorado ranks 11 th nationally for solar capacity Photo courtesy of Xcel Energy.

Photo Courtesy Regional Transportation District. Construction

Colorado New Housing Units and Households 70,000 60,000 50,000 40,000 Housing Units 2001-2007 119,895 more housing units than households 2008-2016 107,409 more households than housing units 30,000 20,000 Households 10,000 0 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Source: Colorado Department of Local Affairs, State Demography Office.

National FHFA Home Price Growth Year over Year Q3 2017 Source: Federal Housing Finance Agency Home Price Index, All Transactions Index.

Federal Housing Finance Agency (FHFA) House Price Index Federal Housing Finance Agency Home Prices by MSA Q3 2016 Q3 2017 Federal Housing Finance Agency Home Prices by MSA CAGR Q3 2007 Q3 2017 Colorado 9.3% Colorado 4% Greeley Denver-Aurora-Lakewood Colorado Springs Fort Collins Pueblo Boulder Grand Junction 0% 3% 6% 9% 12% 15% Percent Denver-Aurora-Lakewood Boulder Fort Collins Greeley Colorado Springs Pueblo Grand Junction -1% 0% 1% 2% 3% 4% 5% 6% Percent Source: Federal Housing Finance Agency, All Transactions Indexes.

Residential Building Permits 1996-2018 Permits 60,000 50,000 40,000 Multifamily 43,400 30,000 20,000 10,000 Single Family 0 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Source: U.S. Census Bureau.

Value of Construction 1996-2018 Value in Billions $25 $20 $15 Non-Building Non-Residential Residential $19.2 B $10 $5 $- 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Source: McGraw-Hill Construction Dodge Research and Analytics.

Leisure and Hospitality

Colorado Public Lands Visits Millions 70,000 Public Lands Visits 2009-2018 60,000 59.3 50,000 40,000 30,000 20,000 10,000 0 2009 2012 2015 2018 Photo courtesy of Colorado State Parks. Sources: National Park Service and Colorado Business Economic Outlook Committee.

National Skier Visits 1980/81-2016/17 Millions 65 60 55 54.8 50 45 40 35 1978/79 1984/85 1990/91 1996/97 2002/03 2008/09 2014/15 Source: NSAA, National Skier/Snowboarder Visits, 1979-2016.

DIA Enplanements and Deplanements 2007-2017 Millions 70 60 61 50 40 30 20 10 0 2007 2009 2011 2013 2015 2017 Sources: Denver International Airport and Colorado Business Economic Outlook Committee.

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Colorado General Fund $ Millions $14,000 $12,000 $10,000 $8,000 Excise $6,000 $4,000 $2,000 $0 Individual and Corporate Income Sales, Use, and Other Excise Fiscal Years Source: Colorado Office of the State Controller and the Colorado Office of State Planning and Budgeting (December 2017). Note: Excludes revenue transferred to the State Education Fund.

Retail Trade Sales Total and Percentage Change $ Millions, 12-Month Rolling Sum $3,000 Percent Change 10.0 $2,500 $2,000 General Fund Sales Taxes Net Sales Taxes 5.0 4.6 0.0 $1,500-5.0 $1,000 $500-10.0 $0 1990 1994 1997 2000 2004 2007 2010 2014 2017-15.0 2008 2010 2012 2014 2016 2018 Sources: Colorado Department of Revenue and Colorado Business Economic Outlook Committee.

Employment and New Entity Filings Employment, thousands 2,700 12-month total new entity filings 120,000 2,600 110,000 2,500 2,400 Employment (L Axis) 100,000 90,000 2,300 80,000 2,200 New Entity Filings (R Axis) 70,000 2,100 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Note: Solid line displays actual seasonally adjusted employment numbers; dotted line reflects calculated forecasts. Source: Seasonally adjusted. Colorado total nonfarm employees from the Bureau of Labor Statistics, Current Employment Statistics (CES), calculations by BRD research team. 60,000

U.S. and Colorado Economies Q2 2003 Q2 2018 Index (50=Neutral) 75 70 National and State Expectations 65 60 Colorado 55 50 45 40 35 30 United States 25 Q2 2003 Q2 2004 Q2 2005 Q2 2006 Q2 2007 Q2 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018

Colorado Ranking Among Other States Metric 1-Year 3-Year 5-Year 10-Year Real GDP Growth 14 7 3 6 Employment Growth 20 11 6 4 Population Growth 7 4 4 3 Personal Income Growth 7 16 2 5 PCPI Growth 43 16 2 24 PCPI 14 14 21 13 Average Annual Pay % Growth 35 26 25 26 Average Annual Pay 10 13 12 10 Unemployment Rate 3 13 28 16 Labor Force % Growth 1 4 4 4 FHFA Home Price Index Growth 6 1 3 2 Data Sources: Bureau of Economic Analysis (2017), Bureau of Labor Statistics (10/17), U.S. Census Bureau (2017), Bureau of Labor Statistics (2017), Bureau Federal Housing Finance Agency All Transactions Index (Q3 2017), BRD calculations. Note: 1-year, 3-year, and 5-year are based on the compound annual growth rate.

Potential Headwinds Interest rates Global growth Commodity prices Value of the dollar Drought and weather Policy

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