Valley economy warming, but slowly
Grand Junction metropolitan area slower to recover than state, U.S.
Grand Junction is lagging well behind the economic recovery under way on the Front Range and the rest of the nation, a Brookings Institution report shows.
In the three years since the first quarter of 2010 — the low point for employment in the Grand Valley during the recession — employment has grown just 2.2 percent, less than half the national rate of 4.5 percent, Kenan Fikri, a policy analyst with the Brookings Institution, said.
The finding, which is contained in the Mountain Monitor, a joint project of the institution and the University of Nevada, Las Vegas, suggests that Colorado’s economic recovery is limited to Front Range metro and nearby small-metro communities, Fikri said.
Employment also declined 0.8 percent from the last quarter of 2012 to the end of the first quarter of this year, the report said.
“No one sector is responsible for this quarter’s employment declines,” Fikri said in an email. “Small declines in a number of sectors combined with the lack of a real growth sector to offset the losses compounded to yield a pretty considerable setback.”
The report also notes that employment in the Grand Junction metropolitan statistical area is down 9.4 percent from its high in the third quarter of 2008.
The “easy answer” to what is driving the employment decline seems to be that the Grand Valley’s industry mix “just doesn’t contain many of the growth sectors like IT, professional and business services, and some manufacturing that are driving employment increases elsewhere in the country,” Fikri said. “Without growth industries priming the economy with momentum, the locally traded sectors of the economy stagnate or contract — and then pullbacks in government spending such as the ones we’re seeing now with sequestration bite harder.”
Other small metro areas in Colorado fared better than Grand Junction since entering into their respective employment troughs, the report said.
The finding that rural Colorado is lagging behind the urban Front Range is no surprise, said Diane Schwenke, president and CEO of the Grand Junction Area Chamber of Commerce.
“The volatility of the energy sector, coupled with a high foreclosure rate (and) not a lot of private construction activity is part of the reason. The other is that we have lost approximately 5,000 people from the labor force,” Schwenke said, “many of them skilled laborers who found work elsewhere where the recovery was happening sooner.”
Recent interviews with 70 businesses on Orchard Mesa reflect continued caution on the local economy, Schwenke said.
“Things are really tenuous,” Schwenke said. “We’re really concerned.”
While employment in Grand Junction was up 2.2 percent, Greeley and Boulder nearly doubled the national average with an 8.9 percent increase in Greeley and an 8.5 percent increase in Boulder.
The Fort Collins-Loveland area is up 6.8 percent while Pueblo is up 3.2 percent, the report says.