The seasonally adjusted unemployment rate of 3.7% is the lowest it has been since it was 2.8% in February 2020, according to Colorado Department of Labor and Employment Principal Economist Ryan Gedney.
The number of unemployed Coloradans dropped by another 9,000 people in March to around 118,000, Gedney said. In February 2020, there were 86,000 unemployed Coloradans.
The employment-to-population ratio, which measures the number of people ages 16+ who are employed compared to the overall population among working-age people, increased by another 21,300 in March to 3,093,500 – 66.4% of the 16+ population.
That is nearly as high as it was before the pandemic started, when it was just below 67%. Gedney said the jump of more than 1% in that figure since December represented a “really big change” over a small period of time.
Colorado’s labor force participation rate was 68.9% in March, the third highest in the nation, Gedney said. That is the second-highest it has been since mid-2012, according to the CDLE. The state’s labor force grew by more than 12,000 people in March – the third straight month the state has seen labor force gains of more than 10,000 people. Gedney said the labor force is now at a “historically high level.”
The 389,400 nonfarm payroll jobs gained back over the past 23 months represent a recovery of 104% of the jobs lost in March and April of 2020 – the 12th-fastest recovery in the country, Gedney said. Comparatively, the U.S. has added back almost 93% of the jobs lost during the first two months of the pandemic.
The job gains in March were led by the leisure and hospitality industry, which added 4,200 jobs last month, Gedney said.
The private sector has gained back 109% of the jobs lost in the first two months of the pandemic, which Gedney said substantially outpaced the U.S. rate of 96%.
Through March, six of the seven major metro areas in Colorado had fully recovered all the nonfarm payroll jobs lost at the start of the pandemic: Grand Junction (127%), Colorado Springs (117%), Denver (107%), Boulder (103%), Fort Collins (100%) and Pueblo (100%).
Greeley is lagging behind the rest, as has been the case for several months, and has only recovered 55% of the jobs lost during that same period. The rest of the nonmetro counties have regained 97% of the jobs lost at the start of the pandemic.
Gedney said it took 57 months for the unemployment rate to go from its peak back down to 3.7% during the Great Recession, compared to 22 months from the peak of 11.8% in May 2020 during this recession.
He said he wouldn’t be surprised if by early next year the unemployment rate is back to pre-pandemic levels, which were historically low at the time, because of the high labor force participation rate and continued growth in the employment-to-population ratio. But he also said he did not want to put an exact month or quarter on that prediction because of outside factors that could affect the trajectory.
And Gedney added that getting back to pre-pandemic unemployment levels would probably be around the floor of the unemployment rate – saying it could perhaps dip down to 2.5% or so, but would be hard-pressed to get down to 2% or below that.