January 2004
Nonfarm employment in the Metro Denver area contracted by 800 positions in November. Total employment is down by 16,700 position for the first 11 months of 2003, a 1.3% decline. Employment is down by 0.8% at the state level, signifying stronger performance than the Metro Denver area but still lagging the U.S. which is posting a decline of 0.3%. Forecasts for Colorado job growth in 2004 range from a low of 1.2% by the Colorado Legislative Council to a high of 2.3% by Xcel Energy’s corporate economist. While most analysts agree that the worst is over Colorado, a slow recovery in 2004 is anticipated.
About 15% of companies surveyed in the national Manpower Employment Outlook Survey in Metro Denver expect to add workers during the first quarter of 2004, similar to hiring plans reported for the first quarter of 2003. The percent of companies expecting to reduce their employment level increased to 17% following an amazing drop to only 2% in the fourth quarter of 2003. Reductions are expected to be a little heavier than this same time last year. The majority of the survey respondents, 51%, report no change in the number of workers.
Year-to-date retail sales for 2003 continued to strengthen in October. Total retail sales for the first ten months of the year are 2.1% higher than the same period last year. Indeed, total retail sales have increased in four of the seven counties.
The number of homes sales closed finished the year at roughly the same level as last year, while the total value of the homes sold increased 3.9% over 2002. There were 47,966 properties closed in 2003, including 11,289 condominiums and 36,677 single-family homes, up 0.1% from a total of 47,919 properties closed last year. The total value of properties sold rose to $12.2 billion in 2003, up 3.9% from $11.7 billion in sales last year.
The Metro Denver office vacancy rate increased to 15.1% in the fourth quarter of 2003, up from a revised 14.8% in the third quarter of 2003. The rate with sublease space was relatively stable, rising from 17.4% to 17.5%. For the year, the direct vacancy rate rose 1.5 percentage points while the rate with sublease space was one percentage point higher.
Data from CoStar Realty Information Inc. indicates a direct industrial vacancy rate of 7.9% in the fourth quarter of 2003, up from the 7.3% rate posted last quarter. The average lease rate slipped to $4.84 per square foot, down from $5.54 per square foot posted during the fourth quarter of 2002.
The Monthly Economic Summary provides a snapshot of metro area economic activity, as well as its relationship to national and regional economic trends.