Attorneys and engineers? Growing. Aerospace? A plus. Telecommunications? Not so much.
Colorado residents have begun reshaping their economy once
again in what’s been a slow and sometimes agonizing process to
replenish jobs lost when the telecom bust sent the region into
its most recent slump.
Yet the state hasn’t fully recovered despite recent progress.
Nor is it likely to be back at top speed in 2007, continuing
to labor under the weight of the national economic slowdown,
housing jitters and consumer worries over debt. Most
economists are predicting sluggish job growth of less than 2
percent next year.
While telecommunications and manufacturing will continue to
languish, the economists point to bright spots ranging from
the defense and space industries, to the energy sector and
business professionals, a catchall group ranging from
attorneys to engineers.
A key addition will be the newly formed Denver-based United
Launch Alliance, a $1.06 billion joint venture between
Lockheed Martin Corp. and Boeing Co. to supply the government
with launch services for rockets.
“The aerospace industry is one of the key industries here in
Colorado,” economist Patty Silverstein said. She noted that
the private side of the industry employs about 24,700,
third-highest in the country. An additional 29,000 are
employed in aerospace for the military.
“With the ongoing war in Iraq, Colorado should continue to
benefit from federal defense contracts,” said Marco Caceres, a
senior analyst with Teal Group Corp. in Fairfax, Va., which
studies aerospace and defense industries. Even without the
war, most satellite systems are in need of being replenished,
which should benefit Colorado companies, he said.
Like many of its Western neighbors, Colorado has learned to
deal with economic boom-and-bust cycles. Historically, the
downturns have centered on natural resources, such as an 1980s
fall by the oil-and-gas industry that put thousands out of
work.
During the 1990s, residents worked to attract more high-tech
businesses, construction and tourism, an effort that pushed
Colorado and the region onto the map as one of the country s
fastest growing areas.
By late 2001, Colorado was hit hard by a national recession,
the collapse of the dot-com industry, the Sept. 11 attacks,
drought, wildfires and the shift of some jobs overseas. Over
the next two years, Colorado recorded job losses of about
76,000 the first time the state posted consecutive years of
overall job declines since the Depression.
The telecommunications industry was hit hard by a combination
of consolidation, improved technology and other changes,
eliminating nearly 20,000 jobs between 2001 and this year,
according to statistics compiled by the University of Colorado
Leeds School of Business.
The overall work force dwindled to 2.11 million in February
2004 before it began to climb out of the doldrums that spring.
By the beginning of this year, the economy started back on
the right track as jobs were added in nearly every sector and
the work force grew to 2.28 million.
The star performer was business and professional services,
which has become the third largest industry category behind
trade, transportation and utilities and government. Between
1996 and 2005, nearly 62,000 jobs were created in this
category which includes such professions as scientists,
engineers, attorneys and accountants.
“That’s where we expect to see the bulk of our employment
increases as the whole business-to-business aspect continues
to grow,” said Silverstein, president of Development Research
Partners.
In its 2007 forecast, the University of Colorado has
predicted 42,300 new jobs in the year ahead, an increase of
1.9 percent, with positions added in nearly every sector.
Forecasts for other sectors issued by CU include:
- From oil and gas rig workers to the support services, the energy industry will remain strong, with growth centered on natural
gas production. - The residential construction industry will slow but
commercial building industrial, commercial and even schools
will do well. - Trade, transportation and utilities will continue to be a
top performer, with a 1.4 percent increase in jobs. - A little more than 2,000 jobs will be added in real estate,
rental, leasing, finance and insurance businesses. - Traditional agriculture has been plagued by restricted
sources for irrigation water in some areas and weather-related
problems. - Net farm income is expected to decline to its lowest level
since 2002, about $700 million.
