Labor Data: The Competitive Denver Labor Market
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Denver has moved from growth mode and has moved into a stabilization mode. Like Los Angeles, higher wages are becoming the norm for employers in the area. Cost for talent is increasing, generally indicative of a skill shortage.
Critical to its success, Denver’s employer base represents a cross-section of industries that require highly skilled talent including Aerospace and Aviation, Bioscience, Broadcasting and Telecommunications, Energy, Financial Services, and Information Technology.
Denver metro area’s monthly job gain remained stable during June 2019 after posting flat monthly job gain during the first four months of 2019. The metro area produced approximately 4,900 jobs during the month of June 2019 for an annual job growth of 1.4 percent. The unemployment rate in the area remains low at 2.4 percent during May 2019. Compared to the last five-years, annual job growth in June 2019 declined approximately 150 basis points (2.9 percent versus 1.4 percent). So far this year, the pace of job gain is hovering around 20,000 jobs per year, whereas the 10-year historical average job gain stands at approximately 37,000 jobs per year. During the optimal economic conditions, Denver can produce anywhere from 50,000 to 55,000 jobs.
“Many sectors’ employers appear to be hungry for workers and wages are starting to rise as the labor market tightens,” said Andrew Friedson, an economist at the University of Colorado Denver.
• Denver’s wage growth increased by 8.4 percent, tied at number one for wage growth with Los Angeles among the 10 markets analyzed in June 2019.
• The robust wage growth is being used as a lever to pull people in the area.
• Among the industries, Tech led with 8.8 percent job growth in June 2019.
• Information, Finance, and Leisure and Hospitality industries experienced job loss.
• Among the blue-collar jobs, Construction and Other Services industries are contributing to job growth in the area as both show approximately 4 percent job growth during June 2019.
With the single-family ratio at 1.77 and the multi-family ratio at 2.55, there is not enough demand (jobs) being produced to absorb supply in the market (single and multi-family homes permitted). According to the National Association of Realtors (NAR), home price growth has simmered down to 1.2 percent growth during Q12019.
Gain more insight into employment statistics, including job growth and hot and cold employment sectors, with ThinkWhy's Major Market Activity Report for June 2019.