Colorado Recovery Watch - April 2012
The most recent economic data from the U.S. Bureau of Labor Statistics show mixed trends for the recovery in Colorado. The unemployment rate, which includes self-employed and farm workers, increased, but so did an employment count that excludes the self-employed and farm workers.1 A robust jobs recovery has yet to solidify in Colorado or nationwide. Enrollment levels for public safety-net programs may be leveling out. Enrollment in the U.S. Department of Agriculture’s Supplementary Nutritional Assistance Program (SNAP), formerly known as food stamps, experienced its largest decrease since July 2007. Moreover, though Medicaid enrollment continues to rise, April saw the smallest increase since April 2011.
Unemployment
In April, Colorado’s unemployment rate nudged up to 7.9 percent, the first increase in three months. (Figure 1) The unemployment rate was steady at 7.8 percent from January through March, and had been trending downward since September 2010. The slight increase in April is not necessarily a change in trends; the longer-range data still suggest we are in recovery. The state’s unemployment rate is 0.5 percentage points lower than it was one year ago. The nation’s rate dropped slightly in April to 8.1 percent.
While Colorado’s unemployment rate has remained below the national average, it ranks 33rd lowest of the states.2 The most recent economic forecasts from the Colorado Legislative Council Staff, released in March, show an improved outlook for unemployment in 2012, though they project high unemployment for the next several years. Colorado’s unemployment rate is forecast at 7.6 percent for 2012, 7.6 percent for 2013 and 7.5 percent for 2014.3 The forecast also predicts wage and salary income to increase 4.6 percent in 2012.4
Current unemployment compared to past recessions
Compared to the past three recessions, the aftermath of the 2007 recession has been far more severe, leaving the unemployment rate higher for longer. Colorado’s current 7.9 percent unemployment rate is also higher than the highest unemployment rate of the last two recessions by 1.6 percentage points. Colorado’s unemployment rate peaked at 9 percent in September 2010 (38 months after the start of the recession) and has been above the current 7.8 percent since April 2009. (Figure 2)
Current unemployment compared to past recessions
Compared to the past three recessions, the aftermath of the 2007 recession has been far more severe, leaving the unemployment rate higher for longer. Colorado’s current 7.9 percent unemployment rate is also higher than the highest unemployment rate of the last two recessions by 1.6 percentage points. Colorado’s unemployment rate peaked at 9 percent in September 2010 (38 months after the start of the recession) and has been above the current 7.8 percent since April 2009. (Figure 2)
Unemployment rate and the labor force
The unemployment rate has an important connection to the size of the labor force. To be counted as unemployed, a worker must be actively looking for a job. The labor force is defined as the number of workers with a job or actively looking for work. About 4,000 workers left the Colorado labor force in April. In the last year, about 10,200 workers have joined the state’s labor force. (Figure 3)
Still, there are about 27,000 fewer active workers in the labor force today than when the labor force peaked in April 2009, keeping the unemployment rate lower than it otherwise would have been. Similarly, as job prospects improve, workers decide to enter or re-enter the labor force, which in turn will prevent the unemployment rate from dropping as fast as it otherwise would.
Unemployment rate and the labor force
The unemployment rate has an important connection to the size of the labor force. To be counted as unemployed, a worker must be actively looking for a job. The labor force is defined as the number of workers with a job or actively looking for work. About 4,000 workers left the Colorado labor force in April. In the last year, about 10,200 workers have joined the state’s labor force. (Figure 3)
Still, there are about 27,000 fewer active workers in the labor force today than when the labor force peaked in April 2009, keeping the unemployment rate lower than it otherwise would have been. Similarly, as job prospects improve, workers decide to enter or re-enter the labor force, which in turn will prevent the unemployment rate from dropping as fast as it otherwise would.
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Colorado Fiscal Policy Institute, a project of the Colorado Center on Law and Policy
789 Sherman Street, Suite 300, Denver, Colorado 80203 / 303-573-5669 / www.cclponline.org
Employment
The increase in the unemployment rate and the decrease in labor force participation are measured in a U.S. Bureau of Labor Statistics household survey, called the Local Area Unemployment Statistics survey (LAUS), which reported a 6,209 net decrease in employment in April. (Figure 4)
However, another survey, called the Current Employment Statistics survey (CES), which excludes the self-employed, farm jobs and striking workers, reported a net increase of 1,200 jobs. (Figure 4) April is the fourth straight month of job growth reported by the survey. In April, Colorado was down 58,400 jobs since the recession started in December 2007. That rate of recovery is worse than 16 other states in the nation. Compared to a year ago, there are 39,800 more nonfarm payroll jobs. Despite being far below pre-recession job levels, Colorado employment in April reached its highest level in three years.
The construction sector saw large gains in employment, alongside trade, transportation and utilities, and education and health services. Leisure and hospitality employment saw the largest private-sector decrease.
Employment
The increase in the unemployment rate and the decrease in labor force participation are measured in a U.S. Bureau of Labor Statistics household survey, called the Local Area Unemployment Statistics survey (LAUS), which reported a 6,209 net decrease in employment in April. (Figure 4)
However, another survey, called the Current Employment Statistics survey (CES), which excludes the self-employed, farm jobs and striking workers, reported a net increase of 1,200 jobs. (Figure 4) April is the fourth straight month of job growth reported by the survey. In April, Colorado was down 58,400 jobs since the recession started in December 2007. That rate of recovery is worse than 16 other states in the nation. Compared to a year ago, there are 39,800 more nonfarm payroll jobs. Despite being far below pre-recession job levels, Colorado employment in April reached its highest level in three years.
The construction sector saw large gains in employment, alongside trade, transportation and utilities, and education and health services. Leisure and hospitality employment saw the largest private-sector decrease.
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Colorado Fiscal Policy Institute, a project of the Colorado Center on Law and Policy
789 Sherman Street, Suite 300, Denver, Colorado 80203 / 303-573-5669 / www.cclponline.org
Job shortfall
When the recession began, Colorado had 2,350,200 jobs. In the period since December 2007, Colorado has experienced a total of 29 months of job losses. Colorado's employment trough occurred in January 2010, when the state had 141,000 fewer jobs than before the recession started. In April 2012, Colorado had 58,400 fewer jobs.
Colorado's jobs shortfall, or the difference between the number of jobs the state has and the number it needs to regain its pre-recession employment rate, is 207,300. That number includes the 58,400 jobs that Colorado lost plus the 148,900 jobs it needs to accommodate the 6.3 percent growth in population that the state has experienced since the recession began. (Figures 5-6)
As the jobs shortfall shows, Colorado has not recovered from the Great Recession. As state and federal elected officials make policy choices to deal with budget shortfalls, putting Americans back to work needs to be their primary goal.
Job shortfall
When the recession began, Colorado had 2,350,200 jobs. In the period since December 2007, Colorado has experienced a total of 29 months of job losses. Colorado's employment trough occurred in January 2010, when the state had 141,000 fewer jobs than before the recession started. In April 2012, Colorado had 58,400 fewer jobs.
Colorado's jobs shortfall, or the difference between the number of jobs the state has and the number it needs to regain its pre-recession employment rate, is 207,300. That number includes the 58,400 jobs that Colorado lost plus the 148,900 jobs it needs to accommodate the 6.3 percent growth in population that the state has experienced since the recession began. (Figures 5-6)
As the jobs shortfall shows, Colorado has not recovered from the Great Recession. As state and federal elected officials make policy choices to deal with budget shortfalls, putting Americans back to work needs to be their primary goal.
Medicaid and CHP+
Public assistance for health care remains of critical importance for Coloradans in the current recovery. The caseload for Medicaid and Child Health Plan Plus (CHP+), the programs that provide medical assistance to low-income residents and children, has increased 61 percent since the start of the recession. Years after heavy caseload growth, April enrollment increased only 380, bringing the total enrollment level to 716,981.6 (Figure 7) That is the smallest monthly caseload growth since April 2011. Between April 2011 and April 2012, Medicaid enrollment increased about 10 percent, or by about 68,000 people. Coloradans’ increasing dependency on the programs for medical care during the recovery is testament to their importance to the state’s well-being.
Food assistance
SNAP has continued to experience increased enrollment through the recession and current recovery. According to the most recent count in February, the program experienced the largest decrease in enrollment since July 2007. Since then, enrollment has increased almost 100 percent. The decrease in April is a good sign, but the overall trend has been increasing since the recession began in December 2007. What’s more, the level remains extremely high: 488,691 people in Colorado, about 9.5 percent of the population, continue to receive help buying food from the program. (Figure 8)7
A recent report from the U.S. Department of Agriculture found that food stamps benefits helped reduce poverty across the country by 4.4 percent between 2000 and 2009.8 The impact on the child poverty rate was even higher. These figures provide a glimpse at the important role that our public safety net has played throughout the recovery.
Mixed indicators show full recovery a ways off
While some of the data is mixed, trends from different employment surveys show some improvement in the job market. However, a serious shortfall remains, in part because the state’s population continues to grow. Without a strong jobs market, the labor force continues to fluctuate, seeing 4,000 workers leave this past month. On the bright side, Colorado has regained more than half of the jobs it lost since before the recession hit in December 2007. That is a good step, but it will take many years of improvement that strong and stronger to bring the labor market back to health.
Colorado’s safety net assistance, such as Medicaid and SNAP, has proven its merit during the recession, helping hundreds of thousands of Coloradans stay afloat. Enrollment levels in these programs stabilized a bit last month, seeing either decreases or only very slight increases. This is a good indicator that improvements are ahead, but until we experience a full-scale, self-sustaining jobs recovery, these programs will continue to be vital to Colorado’s well-being.
Mixed indicators show full recovery a ways off
While some of the data is mixed, trends from different employment surveys show some improvement in the job market. However, a serious shortfall remains, in part because the state’s population continues to grow. Without a strong jobs market, the labor force continues to fluctuate, seeing 4,000 workers leave this past month. On the bright side, Colorado has regained more than half of the jobs it lost since before the recession hit in December 2007. That is a good step, but it will take many years of improvement that strong and stronger to bring the labor market back to health.
Colorado’s safety net assistance, such as Medicaid and SNAP, has proven its merit during the recession, helping hundreds of thousands of Coloradans stay afloat. Enrollment levels in these programs stabilized a bit last month, seeing either decreases or only very slight increases. This is a good indicator that improvements are ahead, but until we experience a full-scale, self-sustaining jobs recovery, these programs will continue to be vital to Colorado’s well-being.
Contact: Ben Felson
CC/Rice Fellow
303-573-5669, ext. 316
Released April 20, 2012
1 Every year, the Bureau of Labor Statistics revises its historical labor force estimates to reflect new Census Bureau population controls, updated input data, and re-estimation. These data also incorporate new seasonal adjustments for more accurate estimates. Effective with the January 2012 edition of Colorado Recovery Watch, these revised estimates will be used. As a result, the data for charts in this and future editions of Recovery Watch will differ from versions prior to January 2012 .
2 Economic Policy Institute analysis of U.S. Bureau of Labor Statistics Current Employment Survey data.
3 “Focus Colorado: Economic and Revenue Forecast,” Colorado Legislative Council Staff: Economics Section, Mar. 19, 2012.
4 “Focus Colorado: Economic and Revenue Forecast,” Colorado Legislative Council Staff: Economics Section, Mar. 19, 2012.
5 Colorado Legislative Council Staff for the chart design.
6 Analysis of “Premiums, Expenditures and Caseload Reports,” Colorado Department of Health Care Policy Financing.
7 Analysis of U.S. Department of Agriculture SNAP program data, provided by: “Latest Available Month - State Level Participation,” USDA Food and Nutrition Service.
8 U.S. Department of Agriculture Economic Research Service, Report number 132: “Alleviating Poverty in the United States. April 2012.
