Unemployment has been much worse in Colorado than originally assumed, according to a new report that should send a clear warning throughout the halls of local and state government.
The U.S. Bureau of Labor Statistics reported this week that for months unemployment estimates by the state Department of Labor and Employment have been off by nearly 17,000 jobs. The new figure — 106,300 jobs lost in Colorado last year — amounts to the worst decline since 1940 and far surpasses the loss of 74,100 jobs in 2002 and 2003, The Denver Post’s Aldo Svaldi reported.
The new numbers suggest “that we are caught up with the national recession in a pretty fierce way,” said Richard Wobbekind, an economist with the University of Colorado.
Indeed. Before the more reliable report this week, estimates had suggested that Colorado’s unemployment had peaked at 7.8 percent. In fact, it peaked at 8.3 percent last June, and finished January at 7.4 percent.
The numbers suggest more families are suffering than expected, which better explains the greater demand for public assistance and less tax revenue coming in. Revenue collections at the state level continue to lag the expectations set out by the governor’s office.
General fund revenue collections in February were nearly $30 million below estimates, or 8.6 percent lower. Year-to-date collections were a little stronger, but still 2.4 percent lower than anticipated. Compared to the prior fiscal year — which was no bed of roses — Colorado revenues are more than 9 percent lower.
Meanwhile, Colorado lawmakers are trying to bridge a $2.2 billion budget deficit this fiscal year, which ends June 30, and an expected $1.3 billion for the next.
Given that tax revenue collections traditionally are slow to recover once the economy improves, lawmakers should be careful not to get lulled into thinking the worst is behind them.
Against this backdrop, it is good to see that the candidates in Colorado’s gubernatorial race are pressing job creation as signature issues.
Coloradans should press Denver Mayor John Hickenlooper and former Congressman Scott McInnis and businessman Dan Maes for details about how they would promote economic growth and job creation — and deal with the state’s chronic revenue shortfalls.
And as Colorado’s lawmakers continue to find budget fixes, we hope they will avoid the type that backfired on them this week, after a repeal of a tax exemption led to Amazon’s regrettable but understandable firing of its Colorado associates, impacting an estimated 5,000 jobs.
Colorado needs more pro-growth policies and needs them now.
