Economic Forecast: Success and economic growth bring new challenges to Metro Denver
The strength and diversity of Metro Denver’s economy will ensure the region continues to thrive in the upcoming year, according to the 2018 Metro Denver Economic Forecast presented on Jan. 31, 2018, at Vectra Bank's 25th Annual Economic Forecast breakfast. The event took place at the Denver Center for the Performing Arts.
Patty Silverstein, chief economist for the Metro Denver Economic Development Corporation (Metro Denver EDC), presented the Metro Denver forecast, which includes national-level analysis and estimates for the state economy as well.
Compared with the national average, Metro Denver's 2017 employment growth was 0.6 percentage points higher at 2.1 percent. Silverstein forecasts Metro Denver's job growth in 2018 to be 1.9 percent, with gains in all 11 supersectors. She anticipates that three supersectors of the regional economy will post strong employment growth in 2018: transportation, warehousing, and utilities supersector (4.5 percent), natural resources and construction (3 percent), and education and health services (3 percent).
“The Metro Denver region’s eighth consecutive year of expansion will provide diverse employment opportunities for our 3.2 million residents. Still, the expected increase of 31,400 jobs in 2018 represents a slower pace of growth, primarily due to limited labor availability,” said Silverstein.
Metro Denver’s unemployment rate is expected to move up slightly to 2.6 percent in 2018 and remain near historic lows.
“The Metro Denver region’s economy is strong and growing, but make no mistake, our success is presenting new challenges we must address to continue to thrive,” said J. J. Ament, CEO of the Metro Denver EDC. “We boast one of America’s most talented workforces of today, but we must build the talent pipeline of the future.”
The forecast reports that slower net migration activity, lower affordability, and higher interest rates should temper home price growth in 2018. The pace of construction activity will remain strong in 2018 as several million square feet of office and industrial space will continue to bolster the market.
Large scale infrastructure projects and other public/nonprofit investment activity will continue at a robust pace. In 2018, construction is scheduled to start on Denver International Airport’s (DEN) $650 million terminal renovation as well as $1.5 billion towards concourse expansions. Denver Water is planning a $420 million expansion project to enlarge Gross Reservoir in Boulder to help supply water to 1.4 million people in Metro Denver. Major transportation projects include work on C‐470 express lanes, widening of I‐225, express lanes along I‐70 east of downtown, and ongoing improvements to I‐25. The Regional Transportation District (RTD) will continue work on FasTracks projects in 2018 including the G Line and other projects throughout Metro Denver.
“Our international airport is truly world-class, but we must also invest in our highways and bridges statewide,” Ament noted. “This is a fantastic place to work and live, but we must increase our inventory of housing to accommodate those who want to own a home. I’m confident we can address these issues. There’s no community in the country that works more collaboratively to solve big challenges than Colorado does.”
The forecast for Metro Denver includes the seven counties of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, and Jefferson. Economic indicators analyzed include: population trends, employment by industry, unemployment, retail sales growth, commercial real estate, and residential activity.2018 Forecast - Key Indicators (e)=estimate (f)=forecast
|Metro Denver||2017 (e)||2018 (f)|
|Employment Growth Rate||2.1%||1.9%|
|Non-Agricultural Employment (thousands)||Total: 1,651.3||Total: 1,682.7|
|Retail Trade Sales Growth Rate||5.4%||5.5%|
|New Residential Units||24,266||24,144|
» 2018 Economic Forecast for Metro Denver (national, state, and regional forecast, PDF)
» 2018 Economic Profile Brochure for Metro Denver/Northern Colorado (PDF)