Colorado matches record-low, pre-pandemic unemployment level

Colorado’s unemployment rate matched the record-low rate of 2.8% in January, according to the Colorado Department of Labor and Employment.

It's the most recent information available, and was released Monday.

That rate remained steady between December and January while the state added 800 new jobs in that time, according to the department, which also released 2022 year-end data Monday.

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Colorado’s seasonally adjusted unemployment rate did not change in January compared to the revised December rate, which was 2.8%. That matches the state's pre-pandemic low set in February 2020.

During that time, the number of people who were unemployed grew by 1,300, reaching 90,400. But the labor force also increased by 8,000, reaching 3,206,400 for a labor force participation rate of 68.1%. Those employed in the state grew by 6,700, reaching 3,115,900 individuals, or 66.2% of Colorado’s population that is 16 years old or older.

The national unemployment rate declined to 3.4% in January, which is a 54-year low, while the labor force participation rate was 62.4%. The U.S. employment-to-population ratio was 60.2% in January, 6.2% lower than Colorado's rate.

"With Colorado’s unemployment rate dropping below three percent, it is clear that Colorado is the best place to live, work, and do business," said Gov. Jared Polis in a Monday news release. "More entrepreneurs are starting businesses in our state and we are outcompeting other states for businesses and jobs."

State businesses added 800 nonfarm payroll jobs between December and January, bringing the total amount of jobs in the state to 2,883,000. Those 800 jobs were in the government sector alone, according to the report, meaning the private sector added no new jobs in that period.

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The job recovery rate in the last 33 months has reached 116.4% in Colorado, which is higher than the national rate of 112.3%. Comparatively, the rate since May 2020 for the state is 120.4% compared to the national rate of 115.2%, according to CDLE. Colorado’s rate of job growth in the last year is 2%, which sits behind the national 3.3% rate.

The private industry sectors with the most significant job gains during January included educational and health services, equal to about 2,200, and professional and business services, equal to about 1,300. Job losses, however, occurred largely in financial activities, reaching about 1,300, and construction with 1,100 losses.

The job losses for financial services were related to inflation, while construction losses could have been affected by cold and snowy weather, according to Senior Labor Economist Ryan Gedney.

“I would say that both insurance and construction, also the banking sector as well, are impacted by this high inflation environment and the Federal Reserve’s efforts to really try to tamp down that inflation with higher interest rates,” Gedney said during a Monday press conference. “Construction … could be also impacted by weather events in January. Construction is particularly sensitive to weather. A high interest rate environment certainly can impact the employment over the long term for those sectors.”

Since January last year, nonfarm payroll jobs have increased by 57,000 in Colorado. The private sector has grown by 52,900 and the government added 4,100 jobs, according to the report. The largest private sector jobs added to the market were in leisure and hospitality (about 20,000), professional and business services ( about 18,400), and trade, transportation and utilities (about 6,200). In the last year, financial activities and information payroll jobs declined by about 2,700 and 900, respectively.

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The average workweek over the last year has decreased slightly from 33.5 to 33.4 hours. At the same time, average hourly earnings grew from $34.18 to $36.14. The national average hourly earnings is $33.03.

The annual unemployment rate was revised and is now 3% for 2022, compared to 3.6% as previously published. The U.S. unemployment rate was 3.6% last year. Colorado lagged behind the national job growth rate in 2022, with the national rate at 4.3% and the state's at 4.1%.

Data for February will be released March 24.