There are concerns about the construction industry’s impact on Colorado’s fragile recovery, as this sector has lost 60,000 jobs during the last three years. This is nearly half of the 130,000 jobs lost in Colorado, and recently that contraction became worse.
In 2007 the construction industry and related sectors employed one in five private-sector workers, while nowadays that figure is about one in seven. In the past the industry has helped Colorado out of recession, but this time around it’s different as the recession was caused by crises in finance and housing, and these sectors are still a long way from recovery.
Colorado entered the recession late, but is now taking its time exiting, and is fourth from bottom for job growth within the construction industry, with only Nevada having fared worse.
Metro area housing permits in Denver are now at just a fifth of 2005 levels, with numbers expected to fall further before increasing next year. According to the US Bureau of Labor Statistics, the single family home building sector was hardest hit with a loss of 47% of jobs.
Sam Albrecht, executive vice president of the Home Builders Association of Metro Denver, doesn’t think the market has hit the bottom and said that although “Denver was not as hard-hit as some other areas, it doesn’t seem to be recovering as fast. Home sales are tied a lot to unemployment and also to consumer confidence. The signals are still coming in mixed on what the economic recovery is going to look like.”
Much of the non-residential construction in Colorado is government funded, and with the lack of any new federal money many projects will be ending this year. Tucker Hart Adams, a Colorado Springs economist expects that it will be a couple of years before there is any significant improvement.