December 2009 Archives

The Colorado Photonics Industry Association (CPIA) holds its annual meeting at the University of Colorado at Boulder each November to highlight relevant research being conducted at Colorado's universities and recognize the top company in the industry for the past year. This year, the Company of the Year Award was presented to Neal Anderson, vice president of space systems for DigitalGlobe.

Many people have used Google Map or Mapquest, yet it is unlikely that people are aware that those pictures likely came from services provided by a company in our backyard, DigitalGlobe. A little over 15 years ago, the Department of Commerce granted DigitalGlobe, then known as WorldView, a license to build and operate a satellite system to gather high-resolution digital imagery of the earth for commercial sale.

So why is DigitalGlobe important to Colorado and Boulder County?

"DigitalGlobe has shown excellent growth and innovation in the digital imagery market," said David Giltner, president of CPIA. "The recent launch of the company's third high resolution satellite, WorldView-2, highlights the success of DigitalGlobe, as well as the high tech environment in Colorado that supports companies like DigitalGlobe."

More specifically, DigitalGlobe is a significant employer inconspicuously located in southwest Longmont. It has close ties to Ball Aerospace, the manufacturer of its satellites, and Lockheed Martin, located in Jefferson County. In addition, the company works closely with Google and Microsoft, as well as other suppliers in the local area. More importantly, DigitalGlobe demonstrates the value that innovation plays in the sustained prosperity of our local, state, and national economies. We welcome your thoughts about DigitalGlobe and other state or local companies that are quietly shaping the world we live in.

 

As an editor/project coordinator with the BRD for 20-some years, the 2010 Colorado Business Economic forecast was my 20th. Granted I'm not a research analyst or economist, but as a person who's read my fair share of forecasts over the years, here are some things that stuck in my mind as I worked on this year's (in no particular order):

Construction--Don't look for the Construction Sector to lead us out of this recession. Colorado will record only 7,000 single-family permits in 2009--a 37% decline from 2008 and an 83% drop from the peak in 2004.

Energy--Colorado is home to eight of the largest natural gas fields in the nation and three of the largest oil fields. The Henderson Mine is North America's largest primary producer of molybdenum (used in the production of steel).

Retail--Colorado retail sales for 2009 are forecast to decline (decrease, fall, drop, slide--how many ways can you say that? We had to use those words too many times this year.). This significantly affects the coffers of state and local governments.

Healthcare--Sixty-two percent of all U.S. bankruptcies are caused by medical problems. Of the $500 billion spent annually in the U.S. to treat the top 10 most expensive diseases, $93 billion are attributed to obesity-related factors.

High Tech--Colorado ranked third nationally in per capita high-tech employment for the third consecutive year, according to Cyberstates 2009.

Total employment--The current decade shows the weakest job growth of the past four decades, with the addition of approximately 117,900 jobs. Compare that to the 650,000 jobs that were added during the "go-go" 90s.

What did forum attendees think? Check out their comments, along with the complete 2010 forecast, on the BRD website.

 

Thanks to everyone for making the 45th annual Colorado Business Economic Outlook Forum one of our best events ever! More than 600 attendees braved the snow and frigid temperatures to learn where the Colorado economy is headed in 2010. Dr. Wobbekind shares the highlights in the video above.

If you were unable to attend the event, check out the presentations on our website, leeds.colorado.edu/outlook.

Managing Director Gary Horvath shares how the Economic Outlook Forum will address labor volatility.

Join us December 7th at the event to learn more. Our 45th annual forecast of the state's economy includes snapshots from specific counties and regions around the state, as well as updates on international trade, population, labor force and personal income growth, and a general outlook on the national economy.

Learn More >

In 2008, Colorado ranked 10^th in the country for job growth, increasing 0.8%. According to Economy.com, Colorado is expected to fall in ranking to 31^st, losing 3.8% of employment in 2009, before rebounding to 9^th, with -0.4% employment growth in 2010. It becomes a stark reality check when a state can rank among the top ten performers while recording a net loss of jobs.

Early in the decade, employment peaked in December 2000 and didn't return to that level until December 2005 - a full five years later. Since then, the state added more than 110,000 new jobs before peaking in June 2008. Seventeen months later, the precipitated decline has moderated, but may not be over. Assuming that employment bottoms in Q1 2010 and begins to build, the year could be a net zero for growth. If the state returns to pre-recession growth rates, then it could be likely that Colorado returns to June 2008 employment sometime in 2013. If some new, slower growth becomes reality, it could be longer.

Colorado will have roughly 117,900 more jobs closing out this decade than when it began, all of which were essentially created in the first 12 months of 2000. Population has increased nearly 870,000 over the same period. With unemployment at 6.7% (not seasonally adjusted), there are many more people living off the same number of jobs created a decade ago.

While Q1 2009 total wages were down more than a billion in Colorado year over year, wage growth over the decade has been substantial, growing at a compound annual rate of 3.7% from 2001 through 2008, and outpacing population and employment growth.  During this period, average wages increased 3% per year, employment increased 0.7%, and population at 1.7% (half of which came from in-migration), annually from 2001 to 2008. Regardless of the strong wage performance of the decade, the quick drop in both total and average wages have been a shock to state and local government funding, which relies heavily on income taxes and consumer spending (sales taxes).

Residents and business have undoubtedly been strained in this remarkable recession. Households have experienced wealth shocks (homes and investments), debt shocks (home equity loans, mortgages, credit cards), and job losses. Businesses have seen markets dry up and consumers shrink. The interconnectedness of economies and industries has become ever more apparent (e.g., architects and engineers are pipelines for commercial construction, which is impacted by consumer spending and industrial growth; and as industry grows, population grows thus more rooftops, schools, and infrastructure).

Colorado's industry diversity, innovation, quality of life, and skilled workforce are sure to help state return to growth. Given the state's mix of goods-producing and services-producing industries, and export and domestic markets, the state is clearly a player on the greater national and global economies.

On December 7^th, the Business Research Division at the Leeds School of Business will release our projections for 2009 and 2010 employment in the state at the Colorado Business Economic Outlook Forum. This consensus forecast will be based on the thoughts and expertise of industry leaders on the ground in Colorado, with their comprehensive stories surrounding the numbers. Come listen to the economic intricacies that will impact your community in 2010.

For more information, visit: http://leeds.colorado.edu/brd.