The future success of Colorado businesses rides on how well they adapt to millennials finally overtaking baby boomers in the state’s populace, economists said at a conference Wednesday.
As baby boomers — those born before 1965 — retire, not only does the makeup of the workforce change, but so does the focus of where jobs will be most in demand.
“The growth age from 2010 forward is the 65-plus group, who will have the lowest income earnings, the lowest spending on taxes and goods, but a greater reliance on services,” said Elizabeth Garner, chief demographer at the state Department of Local Affairs.
“We’re getting old really, really fast,” she quipped to attendees of Vectra Bank’s annual economic forecast breakfast.
The gathering typically looks to economic trends of the past to estimate the future, but this year’s event looked more to the changing face of Colorado as an indicator of what’s to come.
“Within a decade, millennials are the bulk of the labor force, and we’re at the tail-end of the baby boomers,” said Patricia Silverstein, president of Development Research Partners. “What they want from the workforce and what that workforce will need to look like could be very different.”
By 2030, Garner said, the largest percentage of the population will be 65 and older.
“This is a service-oriented age group, for health care and travel,” she said. “They are not the goods-buying group.”
The changing workforce will feel added pressure as well, she said.
“The demands on the labor force will be strongest as that population ages,” she said. “The demand for workers comes not only for the new jobs but for those leaving the workforce, putting added pressure on hiring.”
The demographic shift takes on added concern at the state level, where budgets often are determined by legislative changes focused on today’s needs.
“The real problem is when the 65-year-old turns 80, when that share of the population doubles,” said Henry Sobanet, director of the state Office of State Planning and Budgeting. “That’s a demographic shift that this budget was not designed to pay for.”
Difficulty in saving, personal wealth planning and other economic troubles make for a challenge that millennials will feel repercussions for years down the road, Garner said. Much of that is a result of rising home prices and limited inventory.
“The biggest part of personal wealth tends to be real estate, and if they’re unable to enter that market now, how do you make up for that?” Garner said. “If they are not involved with asset accumulation at a young age, where will they be at 45 and 55?”
Overall, though, economic signals point to a strong 2015, and Colorado’s diverse, although aging, workforce will help it maintain growth.
“Colorado is not just oil and gas,” Sobanet said, referring to the oil bust of the 1980s that impacted the state’s economy, “and it is a completely different place than before.”
David Migoya: 303-954-1506, dmigoya@denverpost.com or
