Colorado Recovery May Lag, but Future Looks Bright!
Colorado’s economy entered recession later than the nation. This will likely delay the state’s recovery. However, we do not expect the delay out of the downturn to be as long as the delay in. In other words, Colorado’s recession will be shorter than the nation’s. The relative strength of the housing market, improved credit quality for both households and banks, strong population growth, expansive and expanding transportation networks and a solid base of high paying and growing industries will combine to pull Colorado out of the recession and set the stage for dynamic growth in the years ahead.
While home prices are down from a year ago, we expect prices to improve heading into 2010, as inventories continue to fall and buyer confidence improves. This, along with improved corporate profits, a healthy stock market and an improving labor market, should help consumers loosen their purse strings a bit. While we expect gross state product to grow in 2010, it will likely be in the 2.0 – 3.0 percent range. The unemployment rate will likely remain elevated until firms are adding jobs at a faster clip than workers return to the labor force, which may not happen until later in 2010 or early 2011. However, some jobs may be lost forever, suggesting education and innovation will become an even more important element of Colorado’s economic future.
Written by: Scott Anderson, Senior Economist Wells Fargo, Ed Kashmarek, Economist Well Fargo
Provided by: Scott West, Private Mortgage Banker Wells Fargo scott.west@wellsfargo.com 719-577-5325
