Consumers are spending less, productivity is down, and there is still a high volume of job openings. Is that why a recession may come?
But first, let’s get down to business. Colorado continues to invest in attracting startups and small businesses, recalling last week’s dive into its own venture capital agency. It has announced its own deal offering up to $5,000 per worker.
The City’s Deal Closing Fund has a caveat. Because this is, after all, public money. The $3 million fund will be administered by Colorado Springs Chambers & Economic Development Corporation.
“Just as we have state dollars and incentives that businesses use when they try to add new jobs and capital investments, the city is actively and proactively promoting businesses that come to our area with high-paying jobs. We want to help you,” Jonah said. Reeder Claymeier, President and CEO of the Chamber of Commerce; “They leave this up to us to evaluate projects to make sure they meet their standards.”
This standard is similar to the state’s Job Expansion Incentive Tax Credit Program, which provides tax credits, rather than cash, to eligible businesses that choose Colorado to relocate or expand and employ a certain number of workers. increase. Last year, the state approved 34 such awards. This is double the previous year.
In both cases, corporate applicants should minimize higher paying jobs. Other locations outside the area should be considered. And new jobs must be created within a certain period of time. The city takes him seven years, the state takes him eight years. Both offer credits or payments when a company hits its performance goals.
The Deal Closing Fund plans to subsidize between $1,000 and $5,000 for each net new full-time job created. Employers must pay at least the city’s median salary of about $57,500 a year, according to Bureau of Labor Statistics data. The focus will also be on companies in aerospace and defense, healthcare and medical technology, cybersecurity and information technology, and manufacturing. Applications are currently being accepted by the Economic Development Team of the Chamber of Commerce.
There are a minimum of 10 net new jobs aimed at attracting small businesses. And because it’s irrelevant to state incentives, the deal could be lucrative for companies considering Colorado and Colorado Springs (but not El Paso County, which isn’t participating). In the future, she hopes to change when she achieves great success, which is the first corporate relocation incentive offered by Colorado Springs, she added.
“The point is to support the company when it’s a competitive decision with other states,” Claymyer said. ”
The money comes from the city’s general fund. It is budgeted annually and, according to city officials, may come from the city’s share of the American Rescue Planning Act, a preference of Mayor John Suthers.
“The City will raise the first $3 million from the ARPA Fund, but the General Fund may make future contributions. We have not yet funded the Chamber of Commerce. ARPA Funds will not go into the General Fund.
Where do workers come from?
Colorado Springs lost 36,100 jobs when the pandemic hit in the spring of 2020. But since the recovery began, the city has led job growth statewide. As of July, the city had restored 126% of lost jobs, or 45,400 of her jobs.
By comparison, the Denver area recovered 108% and the state recovered 111.6%, according to the state’s Department of Labor and Employment data.
In other words, it’s very difficult for Colorado Springs to find enough workers. So where do all these new workers come from?
Cecilia Harry, chief economic development officer at the Chamber of Commerce, said labor markets were tight everywhere.
“And just because it’s a national trend affecting[Colorado Springs]doesn’t mean we stop pursuing growth opportunities,” Harry said. One long-term way to address this is by fostering innovation and investment in the community through employers, who have a pipeline of degree programs and training opportunities for individuals entering through K to 12. We may strengthen our pipeline.”
Colorado Springs’ population has been growing steadily, growing 16% over the past decade to 483,956 in July 2021, the U.S. Census Bureau’s estimate. Denver ranked him fourth, according to a study by Axios and The Generation Lab). It also made it to WalletHub’s list of cities to start a business, placing it 9th out of the top 100 cities nationwide (Denver again ranked him 6th).
The city is in focus and we are making the most of it.
“With so much R&D and innovation going on, if these companies can attract more people to work on this innovation and problem-solving, they will be able to deliver solutions for commercial and military applications faster. We will be able to provide it,” Harry said.
Looming ‘shallow’ recession
Longtime Colorado economist Gary Horvath shares his analysis of the Colorado and nation’s economy, saying that despite the incredible job growth seen in the state, we We are headed for a recession that will hit by the end of the year or early next year.
But it will be shallow, said CBER.co’s Horvath. I mean, not everyone notices it.
“Everyone is affected by inflation, but I don’t think it’s equal. It’s the lowest-paid workers who will be hit the hardest,” he said. “The pandemic was a blue-collar recession. White-collar workers continued to work during the pandemic. “
The pandemic has created an even greater divide between the lowest and highest earners. Even if gas prices hit $5 a gallon this summer, white-collar workers may skip the commute. Many blue-collar workers couldn’t.
So if there is a shallow recession, people will be affected differently.
“You have to think that people are spending less,” Mr. Horvath said. “You have a limited amount of money to spend on food. Let’s say you spend 20% of your income on food. I’m not going to spend on
Fed rate hikes are expected to keep consumer prices in check. States and countries are still grappling with labor shortages, a positive economic sign that a recession is unlikely.
Colorado lost about 370,000 jobs in the first two months of the pandemic, but as mentioned in the Colorado Springs section above, they all recovered, and then some. Colorado has added 475,701 jobs since the pandemic hit its lowest point in April 2020, according to BLS data.
But strong job growth cannot continue, he said.
“We added a huge number of jobs,” he said. “We can’t keep up with that rate. We can’t keep up with this rate because the current unemployment rate is his 3.3%. Where are we going to find people to work?”
Blame the pandemic that caused workers, or at least professionals, to declare their resignations last year. This has morphed into the current “Quiet Quit” trend. This trend is workers who never quit their jobs and do neither more nor less than their jobs require. It can lead to decreased productivity.
“You have baby boomers who are supposed to quit, quiet quitters, but this is amazing. It’s a different way of looking at things. You have remote workers. “We are not going to see a significant increase in GDP or a significant increase in employment. Next year, we may add 25,000 to 30,000 jobs, which is positive, but about half what it would normally be.”
Horvath’s forecast for real GDP growth this year is 2.6%, compared with 5.8% last year.
>> View CBER’s outlook report on the Colorado economy
Other working bits
Speaking of jobs, the state recruiting board had 123,535 vacancies listed as of Friday. This is down from her 151,320 on Aug. 11. However, it is about double the number of job openings in April 2021.
What has been the biggest change in the last two weeks? The number of computer and math jobs has decreased by about 60% to 14,861, and the number of jobs in cleaning and maintaining buildings has increased by 20% to 3,007. >> Connecting Colorado Com
→ CDOT Apprentice: The Colorado Department of Transportation has held job fairs all summer long. Now we hope to be able to attract more apprentices to fill that vacancy. A two-year training program for a career in public safety pays $16 an hour and offers 11 paid holidays, paid vacation, We offer a comprehensive benefits package, including a retirement package. >> application (type “apprentice” in the search bar)
→ Need a tool for small business? The U.S. Small Business Administration has many resources to help small businesses in America. And now we’re hosting a webinar series called “The Bottom Line” to shine a spotlight on local businesses and deepen relationships. >> register
→ Who is eligible for Biden’s student loan forgiveness plan? The New York Times has a primer. >> read
Economic news from The Colorado Sun
→ Colorado Subsidized Health Care Education: sun reporter Erica Breunlin reports on a new program called Care Forward Colorado. This pays for two years of schooling to qualify as a nursing assistant, emergency medical technician, and several other occupations. >> read
→ Western Slope real estate boom continues: The actual transfer tax, adopted before the taxpayer’s bill of rights was passed, increased income for 12 communities in Colorado by 84%, reports Jason Blevins. >> read
→ Thrift shops fly around: During the pandemic, people have decluttered. People are trying to save money now. Reporter Kevin Simpson navigates the economics of thrift shopping. >> read
Share your two cents on how the economy is holding you back or helping you at cosun.co/heyww. see you next week! ~ Tamara