Economists at the Southwest Business Forum on Wednesday forecast broad, if modest, economic growth for the next several years.
However, they also said the benefits aren’t necessarily trickling down to the labor force.
“For 90 years, the rising tide lifted all boats,” said Richard Wobbekind, executive director of the Business Research Division at the University of Colorado in Boulder. “The rising tide is not lifting all boats right now.”
Overall, the national, state and local economies are expected to perform well in 2014 as they claw back from the Great Recession that hit in 2008-10.
Colorado is seeing some of the nation’s most robust population growth, but much of that growth is centered near Denver. Wobbekind said 83 percent of the state’s population is concentrated in 12 Front Range counties.
More entrepreneurs are filing with the Colorado Secretary of State’s Office to form business entities, an encouraging sign for growth, Wobbekind said.
“We’re clearly the shining star of this whole part of the country as far as the overall performance of the economy,” he said.
In La Plata County, Robert “Tino” Sonora, a Fort Lewis College associate professor of economics, predicted unemployment would drop to 5.3 percent this year, down from 5.6 percent in 2013.
Per capita income in the county, $39,600 in 2012, lags well behind the state average, which exceeds $50,000.
Sonora said the local labor market hasn’t bounced back as fast as in previous recessions. Measured as a portion of the total population, employment has been slow to recover.
Wobbekind also said real income growth has not kept up for workers without college degrees.
In real estate, Sonora forecast a 2 percent increase in home prices in 2014 to $305,000 in all county markets combined, up from $299,000 in 2013.
He predicted homes will spend a little less time on the market on average, 118 days, down from 130 days in 2013.
“Our little micro-economy is fairly nice,” he said.
The real estate market could be affected by higher interest rates for 30-year mortgages in 2014. Tim Quinlan, a Wells Fargo Securities economist, said gradual rate hikes of no more than 0.5 percent per year will make loans a little bit more costly.
Sonora pointed to a sharp hike in local rents in 2013. The average rent leapt to $989 a month, up from $863. That was spurred by low vacancy rates.
Among tourism indicators, the Durango & Silverton Narrow Gauge Railroad has seen strong growth in recent years, Sonora said. He also forecast 0.2 percent growth in enplanements at Durango-La Plata County Airport this year.
Natural-gas production fell nearly 33 percent in the county in 2013, a trend seen throughout the San Juan Basin in reaction to anemic prices for the commodity. Oil production also fell.
Wobbekind warned a possible ballot measure this year to ban hydraulic fracturing, or fracking, statewide could wreak havoc on the industry in Colorado.
In agriculture, Wobbekind expected farm acreage to move away from corn. Lower corn prices will dent agricultural profitability but will aid cattle ranchers in cheaper feed, he said.
Colorado has an expanding dairy industry, a growth sector Wobbekind attributes in part to the popularity of Greek yogurt.
cslothower@durangoherald.com
