BY FREDA MIKLINGOVERNMENTAL REPORTER
Denver South Economic Development Partnership brought Richard Wobbekind, Associate Dean for Business and Government Relations and Senior Economist to the Lone Tree Arts Center on October 3 to explain the economic indicators that are behind the CU Business Research Division’s conclusion that the confidence index is now negative. He described the economy as “growing but slowing.”
Wobbekind said that U.S. real gross domestic product (GDP) growth has been slowing since 2018 and is expected to continue to do so through 2020 because personal consumption, business investment, and even government spending are all slowing down. GDP growth is still expected to remain positive.
Employment is still growing at a slower rate. Real disposable income and personal consumption have also been declining since 2018 and are projected to do so through 2020. Home price growth in Colorado is still positive but much slowed, when comparing the second quarter of 2019 to the same period in 2018.
“The view of the future tends to be much more negative than consumers’ view of the current situation,” said Wobbekind. He continued, “Business pre-tax profits will finish 2019 in negative territory.” Adding to the bad news, he said, “The manufacturing part of the U.S. economy, which is 15 percent of the total economy, is in recession.”
Next, Wobbekind showed a slide of the federal budget deficit from 2000 up through the present. It showed the federal deficit declining from 2011 through 2015, then increasing steadily starting in 2016 and projected to break the $1 trillion mark in 2020. He pointed out that the country had “managed to get deeper in the hole despite a growing economy.” He added that “tariffs and trade tensions have really hurt the export picture.”
Turning his focus to our state, Wobbekind said that Colorado is now the 7th-fastest state for population growth, though the population increase for 2019 of 74,000 is slightly below that of 2018, which was 77,500. Projected job growth of 49,000 new jobs in 2019 is strongest in the northern Colorado Greeley-Fort Collins area and weakest in the Grand Junction-Pueblo area.
Statewide, sales tax collections are up 5.3 percent in 2019, continuing the trend of the 5.5 percent increase in 2018.
The overall value of construction was $11 billion in August 2019, down from $15 billion in August 2018.
Focusing on our area, Wobbekind said that job growth in Arapahoe and Douglas Counties had been strong for five years and continued to be, across multiple different industries lead by education and health services, followed by construction. He also noted that the number of venture capital deals increased 54 percent in Arapahoe and Douglas Counties from 2018 to 2019, led by a $100 million investment into Boom Supersonic.
For additional information, go to www.colorado.edu/business/business-research-division.
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