Region shifts from jobless surge to labor shortages
A year ago we wrote: “What a difference a day can make. Or a virus. Colorado businesses in virtually every sector of the economy went from crying about being unable to hire enough people to propel continued growth to, almost overnight, laying off and furloughing people at levels not seen since the Great Depression.”
Indeed, news agencies such as this one were tracking the unemployment numbers weekly as companies, governments and nonprofits cast off workers in order to maintain fiscal viability.
The state and region were not alone with unemployment woes with millions of Americans out of work during the worst of the pandemic.
The U.S. Bureau of Labor Statistics reported an unemployment rate of 11.6% in Colorado in May 2020, which represented 360,975 state residents out of work. A year later in May 2021, the rate was 6.4% with 198,100 people out of work.
Industries hardest hit by the economic downturn include the hospitality sector, which shed 76,700 jobs by the end of 2020.”
Northern Colorado and Boulder Valley counties fared somewhat better. In May 2021, Boulder’s unemployment rate was 4.7%, Fort Collins/Loveland’s was 4.9%, and Greeley’s and Broomfield’s was 5.9%.
Industries hardest hit by the economic downturn include the hospitality sector, which shed 76,700 jobs by the end of 2020. Professional and business services were least affected by the pandemic — largely because those workers were able to work from their homes.
Those out of work benefited from expanded unemployment programs throughout the country. Nationwide, unemployment insurance payments peaked in May 2020 with $23.73 billion paid out that month. In April 2021, $4.11 billion was paid out.
Coupled with the unemployment payments, workforce agencies such as Colorado’s grappled with massive fraudulent unemployment claims. In 2019, the Colorado Department of Labor and Employment experienced 99 fraudulent claims. In 2020, it reported 1.1 million fraudulent cases, potentially putting Colorado employers on the hook for large increases in unemployment insurance rates.
Employers coming through the pandemic report challenges to find workers, despite the numbers unemployed, an indication that some workers have left the workforce, are content not working or have decided to change occupations.
Factors likely to affect the state’s employment picture include some reliable predictors.
A study as far back as 2016 said that if the education levels needed to compete in the marketplace were met, it could add $8.5 billion to the economy as employers would add jobs that they need in order to expand. Numbers of students returning to the region’s four-year and community colleges will be key to how impactful education will be.
Also a factor is in-migration, which slowed to a crawl during the pandemic and could accelerate as recovery occurs.
A review of recent news reports shows that in addition to employers trying to hire back, some are also expanding. Technology companies including biotech are adding positions. Oil and gas prices have recovered, which leads to increased hiring to work the traditional energy fields of Weld County. Ball Aerospace and other aerospace industries are hiring, with Ball’s expansion expected to add hundreds to its workforce.
Yet to be seen will be the impact of companies — such as State Farm, among Greeley’s largest employers — that permit their employees to work remotely. Those workers won’t necessarily need to be located near their employer, or even in Colorado.