Service jobs have accounted for most of the employment gains seen nationally in recent years, including in Colorado.
But the state has also added jobs in the goods-producing sector and in , helping make its economy one of the top performers in the country.
“Colorado has the most impressive goods-producing employment growth in the country,” said Mark Snead, an economist with Region Track in Oklahoma City and a former director of the Denver branch of the Federal Reserve Bank of Kansas City.
Even more remarkable, the state has pulled it off with an undersized manufacturing base. Those goods-related job gains are coming from strong oil and gas production and a sharp rebound in construction activity.
“Colorado’s production numbers have surprised me,” Snead said. “Colorado will surpass Oklahoma in natural gas production in the next couple of years.”
Natural resources and mining employment is a fraction of the total and even big gains there can’t move the overall employment needle much. But the activity in that area has triggered hiring in a range of other areas, from field service workers knee deep in mud to accountants, engineers and lawyers riding elevators in downtown high rises.
Job gains in Texas and Utah have run at 13 to 14 percent since January 2010, double the rate seen nationally, Snead said. Colorado is not far behind, at 11 percent.
Despite an outlook that has grown more optimistic over time, Snead said a few items need watching.
Home prices in Colorado have risen sharply and are now averaging $313,036, one of the highest for a noncoastal state. In Oklahoma, where Snead calls home, the average is closer to $150,000.
“Can you grow a big state through in-migration with high home prices,” Snead asked at an economic update hosted by Trilogy Financial Services.
Looking broader, a drop in worker productivity — the amount produced per worker — is especially worrisome, Snead warned.
Productivity normally drops for two or three quarters when hiring ramps up. But the country has seen three straight years of productivity gains below 1 percent, and it looks like the streak will continue this year.
“Businesses are stockpiling labor,” he said. If a more robust economy doesn’t start to justify the hiring soon, it could spell trouble.
Aldo Svaldi: 303-954-1410, asvaldi@denverpost.com or twitter.com/aldosvaldi
