U.S. Bank regional economist Tucker Hart Adams, in her annual forecast this morning, puts the odds of a national recession next year at three-in-four.
Colorado won’t escape the slowdown, but should continue to add jobs at a slower rate next year before the recession takes hold here in early 2008.
“I don’t see anything on the horizon that will make what goes on in Colorado any different than what goes on nationally,” she said.
Unlike the 2001 recession, which resulted from a sharp reduction in business spending following the technology correction, the next recession will be consumer-driven and tied to excesses in the housing markets, she said.
Indicators such as credit card debt and the use of risky mortgages show Colorado consumers are among the most stretched in the country.
But the state as a whole hasn’t seen double-digit increases in home values experienced in hot areas like Phoenix and Las Vegas.
“When home values fall, mortgage debt does not,” she said.
A recession is defined as two consecutive quarters of negative economic growth.
