The Northern Colorado Business Report Monthly Growth Rate was strongly positive in July, the result of a doubling of institutional construction commitments in Larimer County, specifically at colleges and universities. The growth rate was also positive in May and June after being negative for most of the first part of the year. It would appear that economic recovery has started in Northern Colorado.
The Index of Economic Growth in Northern Colorado also jumped up in May, June and July. July was well above levels reached early in 2010. The July rate of growth cannot be maintained, but I do expect slow, moderate growth to occur in the Northern Colorado economy.
The situation does not look nearly as bright for the U.S. economy. There is at least a 50 percent chance that the national economy will drop back into recession. Fiscal policy is in complete disarray, Presidential leadership is weak and no workable policies are being proposed by Congress. Monetary policy has no potent bullets left and Fanny, Freddie and Wall Street banks have made a mess of housing policy.
The world economy will not save the U.S. economy - or vice versa. Europe is a mess and the financial situation there will drag on the U.S. financial sector. The European Community needs more than just a common currency. China's growth will slow if the rest of the world quits buying and India can't get its infrastructure built. Russia can't shake off the old communist influence and the Middle East is in turmoil. Only Brazil and South America are mostly free of conflict. Canada is still doing great.
Employment
Summer job growth in Northern Colorado was as strong in 2011 as it was in 2010 but we appear to be maintaining those jobs better in 2011. Last year we saw a rapid decrease in employment by place of residence in the latter part of the summer; here's hoping that will not occur this year. The region's unemployment rate is very erratic as the labor force fluctuates but will probably remain in the 8 percent to 9 percent range for the next couple of years. The Growth Index for Employment is bouncing along the bottom of its recession dip but is showing no permanent signs of increasing.
Construction
Total value of construction put in place in Northern Colorado took a huge jump in July as a result of a doubling of institutional construction commitments in the colleges and universities category in Larimer County. If not for this category, July numbers would have been little changed from May and June. This is a one-time commitment but should generate some nice multiplier effects in the local economy. Residential construction improved slightly but commercial construction remained comatose.
The trend line in the number of single-family housing permits issued has turned up ever so slightly. However, the peak reached in 2011 was lower than the government-incentive-induced peak of 2010. I do think a slow recovery has started in the housing sector even though the inventory of unsold homes remains high and foreclosures are still occurring. Apartment construction and home rentals remain strong.
Vehicle registrations
Motor vehicle registrations are up sharply. This is due in part to increased new car sales, which have been very strong, both locally and nationally. The slight increase in economic activity has resulted in more vehicles being put on the road. The Growth Index for motor vehicle registrations is at its highest point since 1991, probably ever. The Index is about 230, 2.3 times its level in 1991.
Sales taxes
State data for new and renewed sales tax accounts and retail sales is very slow in getting to me. The state's data collection and reporting activities have been really hurt by budget cutbacks and their faltering attempts at automation of their activities.
Retail sales data is only current through April but indicate that retail sales in Northern Colorado have quickly recovered from the recession. Total retail sales are back on the 20-year trend line, suggesting that the slowdown caused by the recession has been totally recovered and we're back on our 8 percent to 10 percent annual growth trajectory.
So, economic conditions are looking up for Northern Colorado but down for the U.S. economy. If only our nationally elected officials could be struck by the lightning bolt of economic understanding.
Source: www.ncbr.com
The Index of Economic Growth in Northern Colorado also jumped up in May, June and July. July was well above levels reached early in 2010. The July rate of growth cannot be maintained, but I do expect slow, moderate growth to occur in the Northern Colorado economy.
The situation does not look nearly as bright for the U.S. economy. There is at least a 50 percent chance that the national economy will drop back into recession. Fiscal policy is in complete disarray, Presidential leadership is weak and no workable policies are being proposed by Congress. Monetary policy has no potent bullets left and Fanny, Freddie and Wall Street banks have made a mess of housing policy.
The world economy will not save the U.S. economy - or vice versa. Europe is a mess and the financial situation there will drag on the U.S. financial sector. The European Community needs more than just a common currency. China's growth will slow if the rest of the world quits buying and India can't get its infrastructure built. Russia can't shake off the old communist influence and the Middle East is in turmoil. Only Brazil and South America are mostly free of conflict. Canada is still doing great.
Employment
Summer job growth in Northern Colorado was as strong in 2011 as it was in 2010 but we appear to be maintaining those jobs better in 2011. Last year we saw a rapid decrease in employment by place of residence in the latter part of the summer; here's hoping that will not occur this year. The region's unemployment rate is very erratic as the labor force fluctuates but will probably remain in the 8 percent to 9 percent range for the next couple of years. The Growth Index for Employment is bouncing along the bottom of its recession dip but is showing no permanent signs of increasing.
Construction
Total value of construction put in place in Northern Colorado took a huge jump in July as a result of a doubling of institutional construction commitments in the colleges and universities category in Larimer County. If not for this category, July numbers would have been little changed from May and June. This is a one-time commitment but should generate some nice multiplier effects in the local economy. Residential construction improved slightly but commercial construction remained comatose.
The trend line in the number of single-family housing permits issued has turned up ever so slightly. However, the peak reached in 2011 was lower than the government-incentive-induced peak of 2010. I do think a slow recovery has started in the housing sector even though the inventory of unsold homes remains high and foreclosures are still occurring. Apartment construction and home rentals remain strong.
Vehicle registrations
Motor vehicle registrations are up sharply. This is due in part to increased new car sales, which have been very strong, both locally and nationally. The slight increase in economic activity has resulted in more vehicles being put on the road. The Growth Index for motor vehicle registrations is at its highest point since 1991, probably ever. The Index is about 230, 2.3 times its level in 1991.
Sales taxes
State data for new and renewed sales tax accounts and retail sales is very slow in getting to me. The state's data collection and reporting activities have been really hurt by budget cutbacks and their faltering attempts at automation of their activities.
Retail sales data is only current through April but indicate that retail sales in Northern Colorado have quickly recovered from the recession. Total retail sales are back on the 20-year trend line, suggesting that the slowdown caused by the recession has been totally recovered and we're back on our 8 percent to 10 percent annual growth trajectory.
So, economic conditions are looking up for Northern Colorado but down for the U.S. economy. If only our nationally elected officials could be struck by the lightning bolt of economic understanding.
Source: www.ncbr.com
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