Is Colorado In a Recession?

Whether Colorado's economy has joined the rest of the country in recession is a question local economists can't agree on. The National Bureau of Economic Research declared earlier this week that the U.S. economy began contracting a year ago, but the bureau doesn't determine cycles for states.

Colorado Springs economist Tucker Hart Adams thinks Colorado slipped into a recession with the rest of the country 12 months ago.

Colorado probably succumbed to the national recession in October, said Ernie Goss, chief executive of the Denver-based Goss Institute, an economics research firm that publishes the Mountain States Business Conditions Index.

That survey of Colorado supply managers showed contracting conditions starting in October and deepening in November.

The National Bureau of Economic Research looks at several economic indicators to determine the start of a recession. This time around, it leaned heavily on payroll job reports to mark when the current decline began.

Although the U.S. has been shedding jobs all this year, Colorado continued to add jobs through October on a year-over-year basis.

That's why Patricia Silverstein, an economist with Development Research Partners in Littleton, contends the state has avoided a recession so far.

She is forecasting payroll job growth of 0.5 percent for the state next year. While meager compared with the 2.2 percent average growth rate the past 30 years, it still represents a gain. Colorado will continue to perform better next year than the rest of the country, and that will draw additional job seekers.

At the National level Denver is viewed as being in a strong economic position. According to the analysts at The Wall Street Journal, Denver is one of the top 3 cities to do business in for both 2007 and 2008. The Wall Street Journal’s Market Watch rated Denver as #3 in 2008 and #2 in 2007 in their Top Cities for Business study. Cities were ranked against each other in each of the eight categories -- Fortune 1000, S&P 500, Russell 2000, Forbes 400, small-business, unemployment, population growth and job growth.

That fact that there is a debate as to whether Colorado is in a recession is proof that this city is still thriving and strong enough to weather even tough economic times such as these.

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