September 2005
Rising gas prices, potential economic impacts from Hurricane Katrina being monitored
Metro Denver employment continues to outpace national growth. Preliminary figures by the Colorado Department of Labor reveal that year-to-date Metro Denver employment has grown 2.1% compared to 1.7% growth at the national level.
According to data compiled by the Metro Denver Economic Development Corporation (Metro Denver EDC) in its Monthly Economic Summary for September 2005, the largest employment gains have occurred in the Natural Resources & Construction (+4.2%, 3,800 positions), Professional & Business Services (+3.3%, 6,900 positions), Education & Health Services (3.4%, 4,500 positions), and Leisure & Hospitality (+3.1%, 4,200 positions) sectors.
“We are encouraged that Colorado's recovery continues to outpace the nation - with a employment growth rate roughly 20% higher than the national rate," said Tom Clark, executive vice president of the Metro Denver EDC.”
As well, Colorado is maintaining its competitiveness when it comes to the cost of doing business. According to the 2005 Cost of Doing Business Index by the Milken Institute, business costs in the state are 7% below the national average.
However, costs for various items throughout the U.S. are likely to rise in the wake of Hurricane Katrina, which blasted the Gulf Coast on August 29, 2005. The total economic impact could top $100 billion with the most severe impacts felt throughout the Gulf Coast states of Louisiana, Mississippi, and Alabama.
The rest of the country is likely to feel the effect more than previous natural disasters because of Katrina’s disruption to the nation’s energy supply network. Immediate impacts are expected in the energy, construction, and tourism sectors.
“Given the destruction of Hurricane Katrina, we will continue to keep a watchful eye locally for potential economic impacts," said Clark.
While Metro Denver’s economy continues to show slow, steady improvement, only 10 of 18 indicators moved in a positive direction for the month, down from 16 last month. The decline in positive monthly indicators was due to the seasonal decline in employment, poor stock market performance, and slower home sales activity.
Annualized activity remains steady with 15 of the 18 economic variables posting positive changes, the same results as last month. The three indicators which are not currently posting annual improvements include the stock market, home sales, and home foreclosures.
The Monthly Economic Summary provides a snapshot of metro area economic activity and its relation to regional and national economic trends.