The outlook for Colorado Springs is positive, based on information presented at the 21st annual UCCS Economic Forum Sept. 29 at The Antlers hotel.
Speakers Erik Davidson, chief investment officer for Wells Fargo; Michael Serio, regional chief investment officer for Wells Fargo; and Tatiana Bailey, director of the forum, discussed the state of global, national, state and local economic affairs.
According to Davidson and Serio, the stock market is at a record high, the household debt service ratio is at an all-time low — but there remain rising inflation and employment concerns.
“For somebody [who] makes $100,000 a year [and] takes out a $1 million loan — if you’re only paying 1 percent interest, that’s OK, you can handle that,” Davidson said, adding that the debt service ratio is around 10 percent in 2016 compared to more than 13 percent in 2008.
Right now the national unemployment rate is low for workers with a bachelor’s degree or higher (2.3 percent), but remains high at 6.1 percent for workers without any higher education.
“Here’s the issue,” Davidson said. “It’s not the difference between educated and less educated — it’s educated and skilled and less educated and unskilled.”
The total number of job openings remains high, around 5.5 million, compared to the number of hires — around 5 million in 2017.
According to Davidson, the number of total nonfarm workers in the U.S. has increased significantly since the last recession, going from fewer than 132 million workers in 2010 to more than 144 million this year.
The U.S. has seen a 2.4 percent economic growth in 2017, Davidson and Serio said, adding that the probability the country will see a recession in the next 18 months is low.
Bailey discussed major industries in the nation, state and the Pikes Peak region including the growing workforce, increasing real estate prices and tourism.
According to Bailey, in 12 counties across the Front Range, 55,165 new jobs were added in 2016. The Colorado Springs MSA added 7,742 jobs, or 13.3 percent of Colorado’s new jobs.
In the tech industry, El Paso County gained 214 new businesses in 2016 and Colorado saw a 7.3 increase in new businesses in the 12 months ending in June, totaling 113,949.
“[Colorado] is a pretty good place to have a business,” Bailey said.
To match the current population growth, Colorado Springs will need to add 5,400 jobs, she said, explaining 400,621 people are expected to move into the region by the year 2050.
“By the time we get to 2050, we’ll be highly diverse,” Bailey said, explaining Colorado will see an increase in minority populations.
The fastest growing industries in Colorado as of 2016 for employment were agriculture, health care and social assistance, and construction.
Bailey said Colorado’s unemployment rate was 2.2 percent as of August, compared to the national rate of 4.5 percent. El Paso County’s unemployment rate is 2.6 percent as of August.
Forecasts for 2018 indicate El Paso County’s unemployment rate could increase to 3.6 percent and Colorado’s unemployment rate could go as high as 3 percent, while the U.S. rate should decrease to 4.4 percent.
According to Bailey, in-migration to Colorado will continue as long as the difference between Colorado and the U.S. unemployment rates is at least 1 percent.
The event also featured Master of Ceremonies Samuel Elliott, co-founder of Tejon Technologies, as well as brief presentations by UCCS Chancellor Venkat Reddy and Eric Olson, interim dean of the UCCS College of Business.
Additionally, videos were shown featuring Colorado Springs Mayor John Suthers; Chamber and EDC Chief Economic Development Officer Hannah Parsons; and Greg Phillips, Colorado Springs Airport aviation director.
More information can be found at uccseconomicforum.com.