People moving into Colorado faster than state creates jobs for them

By Greg Griffin
The Denver Post
Posted: 04/24/2011 01:00:00 AM MDTUpdated: 04/24/2011 09:33:26 AM MDT

At home, Cheryl Michaels looks for a job in the accounting field. "The market is still kind of tough," she says. (Andy Cross, The Denver Post )Migration to Colorado slowed dramatically or even reversed as jobs dried up in past downturns — helping the economy restore balance.

Not this time.

Colorado employers shed 130,000 jobs from 2008 to 2010, but the state added 145,000 new residents. This year, economists expect Colorado to gain 10,000 to 20,000 jobs, as the population grows by perhaps 85,000, including births. More than 30,000 of that growth could be transplants from other states.

"We're stumped. It's a question we've been struggling with," said Colorado State University regional economist Martin Shields. "Why are people still moving here?"

Theories range from a change in how some younger workers approach their careers — location

Christina and Brian Pannell make lunch last week in their motel room near Fort Collins. They moved here last month from Seattle. Christina has enrolled to begin studying equine sciences at Colorado State University in the fall, but the couple said they planned to move here whether or not she got accepted to the university because of the mountains and the weather. They're staying at the motel with two dogs and a guinea pig as they look for work and a place to rent. (RJ Sangosti, The Denver Post )first, job second — to outdated perceptions that Colorado's economy escaped the recession with light damage. Another potential factor: Some unemployed Coloradans are forgoing job opportunities elsewhere because they can't sell their homes.

The bottom line for many recent transplants is that unemployment is high everywhere and much worse in some places than here, so why not move to Colorado? The state's mountains, sunny weather and recreational amenities ranked highly with a handful of recent arrivals who moved here without jobs, and who spoke with The Denver Post.

Allure of the location

"I figure that it's not going to matter where I'm at if the jobs aren't building back up," said Cheryl Michaels, who moved to Denver from Fresno, Calif., in August 2008 and hasn't been able to find steady work as an accountant. "I might as well be here since I like it here."

Ian Armstrong, 28, moved to Colorado from his native Houston in November, drawn by the skiing, snowboarding and mountain biking, and by friends from the University of Colorado at Boulder.

He recently began a part-time job as a construction engineer, earning half the hourly pay he made doing a similar job in Houston before

Migration to Colorado remains strong even though there are few jobs. Ian Armstrong, 28, moved here from Houston in November after losing his job and found part-time work.April 21, 2011. (Hyoung Chang/ The Denver Post)he was laid off.

"I had a sense that I'd be able to find something here. I didn't look at the unemployment rates or anything like that," Armstrong said. "It's definitely been tougher than I thought."

Steady migration to Colorado is contributing to stubbornly high unemployment — a rate of 9.2 percent in March, or 246,000 people jobless and looking for work. Economists don't expect those numbers to budge much this year, and they could continue to rise. Migration also poses troubling questions, such as whether higher unemployment is something Coloradans will have to get used to and whether anything can be done to rev the economy's growth.

"If the labor force continues to grow faster than the economy creates jobs, then we're going to see prolonged unemployment," Shields said. "Migration is closely tied to jobs, and eventually that would work itself out, but maybe at a higher rate of unemployment when things stabilize."

Net migration — the sum of those moving in and out of Colorado — has been positive since 1991 and appears to have slowed only slightly during the most recent downturn. A Denver Post analysis of population data from the state demographer's office found that net migration to the state fell an estimated 21 percent from 2008 to 2010 but remained above 30,000 last year.

Behind the net numbers, some 240,000 to 300,000 people move each year into Colorado from other states and from Colorado to other states, according to the state demographer's office. About 13,000 to 15,000 move here annually from other countries, though it's not known how many return.

Little demographic information is available about people who moved into and out of Colorado during the past decade. Nearly 40 percent came from or went to other Western states, and about a third came from or went to Southern states, including Texas, the Internal Revenue Service reported.

Depth of disparity debated

The mismatch between population growth and job creation in Colorado may look bigger than it really is.

First, the state's retired population is on the rise, state demographer Elizabeth Garner said. Baby boomers are relatively numerous in Colorado, and the jobs they're beginning to relinquish don't show up in the new-job statistics, Garner said.

Second, new jobs are reported by government and private-sector employers, and those numbers don't include self-employed workers, said Tom Clark, executive vice president of the Metro Denver Economic Development Corp.

Over the past decade, which included two recessions, employers created few if any net jobs in Colorado even as the population grew by about 700,000, Clark said. But there was significant job growth among the self-employed, including consultants, small-business owners and many professionals, he said.

Economist Patricia Silverstein of Jefferson County-based Development Research Partners estimates that the ranks of self-employed in Colorado swelled by as much as 196,000 during the decade.

"A lot of these folks that came to or stayed in Colorado are trying to make it self-employed," Silverstein said. "These innovators, these entrepreneurs are the ones who can get the economy running again. Think if a fraction of these folks can take their business to the next level and hire one worker. We'd be able to overcome those 130,000 jobs lost in the last two years."

Clark expects the migration-jobs issue to start working itself out next year as the economy gathers steam.

Others see long-term problems in the difficulty that the state's employers are having in creating enough jobs.

"The big dogs in the state have moved their headquarters or have been acquired by other people," said University of Colorado economist Richard Wobbekind, referring to Qwest, Frontier Airlines and First Data Corp. "I think it's important to have some big businesses. We're a great state for entrepreneurship, but certainly having some big companies with large employment bases doesn't hurt."