A Snapshot of Colorado’s 2023 Economy

February 5, 2024

Common Sense Institute tracked Colorado’s major economic highlights from 2023 in the following categories: jobs, inflation, labor force, and population.

Jobs

Initial Figures Indicate Private Sector Growth Slowed

· In 2023, the private sector only added 1,100 jobs, the lowest number outside of a recession since 1991. However, revisions are expected later in the spring given reported low response rates.[i]

· The average private sector employment growth from 2010-2022, excluding recession anomalies, was 57,350 jobs.

· The 12-month change in government sector jobs in 2023 was an increase of 23,000 jobs.

· In 2023, the government (federal, state, local) sector gained 23,000 jobs, the third highest increase in jobs; the service-producing sector gained the most jobs with an increase of 30,100 jobs.

· The financial and insurance sector lost 7,400 jobs, the second highest amounts of jobs loss; the trade, transportation, and utilities sector lost the most jobs equaling a total loss of 10,400 jobs.

· The management of companies and enterprises sector stayed at the same level of jobs as in the previous year.
 

By Sector

Inflation

· The 2023 inflation rate in the Denver Metro Area was 5.21%, a -2.8-percentage point difference from 2022.

· The inflation growth in 2023 was the highest rate of inflation since 1983.

· In October and November of 2023, the average Colorado household spent $1,206 more per month due to high inflation since 2020.

· Bi-monthly Inflation was higher at the start of 2023, with the largest increase of 1.34% occurring from February to March.

· From October 2023 – November 2023, the inflation rate decreased by 0.34%, indicating prices actually came down for just the second time since 2020. This was largely driven by the slower rates of growth in prices, like transportation and housing.
 

Labor Force

· Colorado’s labor force participation rate increased 0.4 percentage points in 2023, from 68% to 68.4%. However, this rate remains below the state’s pre-pandemic LFPR of 68.9%.

· Since 2000, Colorado’s LFPR has fallen from 72.7%, to 68.4%. If the rate had stayed the same, roughly 200,000 more Coloradans would be in the labor force.

Unemployment

· Colorado’s unemployment rate increased from 2.8% to 3.4% in 2023. This is the first year since 2019 that the state’s unemployment rate never hit 4% at any point.

· The number of unemployed in Colorado was 109,569 in December of 2023, up from 89,130 in December of 2022.

· The average unemployment rate in 2023 was 3.0% compared to 5.5% in 2021. 

Population

· Colorado’s population grew to 5.8 million people, a 0.5% increase from 2022.

· For the second year in a row, net international migration outpaced domestic migration in 2023.

· The state gained 11,900 people from international migration and 7,200 from domestic migration

[i]

2023 Q2 Expected Revisions to Colorado Nonfarm Payroll Jobs Press Release (colmigateway.com)