Friday, September 21, 2012

Colorado Recovery Watch - August 2012

The most recent economic data from the U.S. Bureau of Labor Statistics show a decrease in the state and national unemployment rates, unfortunately for the wrong reasons. The Colorado unemployment rate moved from 8.3 percent in July to 8.2 percent in August while the national rate moved from 8.3 percent to 8.1 percent in the same time frame. The decrease in the Colorado unemployment rate was primarily due to a decrease in the labor force as more than 11,000 Coloradans gave up the search for work in the month of August. Adding to the disappointing news, employment levels remained largely unchanged throughout the state and enrollment in safety net programs such as Medicaid, CHP+ and SNAP increased from July levels.

In August, Colorado’s unemployment rate decreased from 8.3 percent to 8.2 percent. (Figure 1) Although this is the first decrease in Colorado’s unemployment rate since April of this year and is one-tenth of a percentage point lower than a year prior, this month’s decrease is due to workers exiting the labor force, not an uptick in hiring. The August unemployment rate is more than four percentage points higher than when the recession began. The national unemployment rate also decreased, from 8.3 percent to 8.1 percent. Again, this decrease is largely due to a shrinking labor force nationwide.

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Colorado’s unemployment rate is now the 21st highest among the 50 states. Furthermore, the most recent economic forecast from the Colorado Legislative Council staff (LCS), released September 20, recognizes the weak economy both on the national and state level. Consumers and businesses are holding back on things like spending, hiring and investment because of economic and political uncertainty, according to LCS. As a result, LCS expects economic growth to lose momentum as 2012 comes to a close, nearing recessionary levels in the early part of 2013.

In the latest edition of Colorado Recovery Watch, Rice Fellow Andrew Ball examines a range of data showing where the state of Colorado stands on the road to economic recovery.

Colorado Recovery Watch is a monthly snapshot of economic data, with a special focus on jobs and public-assistance programs. Read it online, along with other analysis of jobs and economic security from the Colorado Center on Law and Policy

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