Colorado logs a second straight month of employment gains on strong government hiring

Since last fall, Colorado employers have gone from adding jobs one month to shedding them the next, resulting in an economy that has behaved more like a sputtering lawn mower than a finely tuned engine that fires up on the first pull of the cord.

But that changed in May, when the state finally strung together two consecutive months of respectable job gains, according to an update Friday from the Colorado Department of Labor and Employment. Despite that, 2023 still appears to be lagging.

“After five months it seems the Colorado labor market is underperforming the U.S., assuming there will be no major revisions in the future. It is easy to look at the data and see where changes are occurring. It is more difficult to understand the structural changes in the economy that are causing these changes,” said Broomfield economist Gary Horvath in an email.

“In other words, why is the Colorado economy struggling more than other states?” he asked.

Colorado employers added 3,900 nonfarm jobs between April and May, which follows a revised gain of 6,100 jobs between March and April. Originally, the CDLE had estimated an increase of 7,200 jobs in April.

The private sector added 2,800 jobs last month while governments added 1,100. Other services, a catchall category, was up by 3,900 jobs; leisure and hospitality was up by 2,900 and manufacturing was up by 1,300.

“After declining for two straight months, Colorado’s manufacturing sector bounced back in May, adding 1,300 jobs. This was the largest growth for this sector since June 2020 when it added 1,300 jobs,” said Cole Anderson, a research analyst with the Common Sense Institute, in comments on the employment report.

The biggest declines came in professional and business services, down by 1,900; construction, off by 1,800, and financial activities, which shed 1,200 positions.

Over the past year, the state has added 30,200 jobs, which translates into a relatively anemic 1.1% growth rate. Four sectors have lost jobs in the past 12 months. The state’s economy would be in a much weaker spot absent the 17,200 jobs added in the public sector and the 21,200 that came in leisure and hospitality.