A paint-by-numbers portrait of the economic landscape
Statistics for the first half of 2013 complete a kind of paint-by-numbers portrait of the economic landscape in Mesa County. As usual, the composition offers a mix of encouragement and frustration. Here’s a look at what’s passed and what’s ahead:
An improving real estate market tops the list of encouraging indicators with a 5.5 percent increase in real estate transactions and 9.3 percent increase in dollar volume through the first half of 2013 compared to the same span in 2012.
The median price of residential properties sold through the multiple listing service continues to trend upward, hitting $180,000 in June. Conversely, property foreclosure activity continues to trend downward. For the first half of 2013, foreclosure filings plummeted 45.3 percent and foreclosure sales retreated 16.3 percent compared to the first half of 2012. Residential construction held steady through the first half of 2013 with a slight increase in the number of single-family building permits issued in Mesa County over the same period in 2012.
The labor market shows signs of improvement, albeit at frustratingly slow pace. After four consecutive months of declines, the seasonally unadjusted unemployment rate finally slipped below 8 percent in May only to bounce back up more than a point in June. The gain can be attributed, though, to a seasonal influx of college students and others looking for work. There were only 217 new filings for unemployment benefits in Mesa County during June, the lowest number in nearly five years. Labor demand as measured by the number of job orders posted at the Mesa County Workforce Center through the first half of 2013 outpaced last year. Even at 9 percent, the latest jobless rate remains seven-tenths of a percent lower than this time last year. Although nonfarm payrolls statewide have rebounded to pre-recession levels, Mesa County still has a long way to go in climbing back toward the peak employment that occurred during the regional energy boom that preceded the economic bust.
A long slide in sales tax collections finally ended when the City of Grand Junction and Mesa County announced gains in their June reports. Prior to the latest reports, collections had declined on a year-over-year basis in nine out of the 10 previous months for the city and 10 out of the previous 11 months for the county. For reports covering the first half of 2013, collections remain 3.4 percent behind the first half of 2013 for both the city and county. Because they lag a month behind, sales tax reports actually reflect spending that occurred between December and May.
So much for history. What about the outlook for the second half of 2013? There’s still a sense that because Mesa County was late going into the recession, the area has been late in fully recovering.
If increasing real estate activity continues at its present pace, year-end numbers for transactions and dollar volume will rebound to their highest levels since 2008. That prospect depends, though, on the effects of what’s expected will be higher interest rates and new regulations.
Despite the seasonal speed bump in June, labor conditions are expected to gradually improve, although not necessarily at the rate of other areas of Colorado.
Local government administrators hope year-over-year gains in sales tax collections reported in June constitute the start of an upward trend, especially considering new numbers will be compared to a nearly year-long decline. The question remains whether second-half gains, if realized, will offset first-half losses and help in balancing budgets.