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Lagging recovery affirms a need for helpful efforts

Two disconcerting indicators continue to reflect the lag in economic recovery in Mesa County compared to other areas of Colorado. While the unemployment rate remains stubbornly high, sales tax collections trend downward. And if you surmise there’s a connection between the two, you’re likely right.

The circumstances lead to a second point, and that’s the importance of ongoing efforts to assistant entrepreneurs to start and grow their ventures, create jobs and bolster the wages that in turn lead to increased sales. Here the outlook is considerably better in the latest validation of the 25-year mission of the Business Incubator Center in Grand Junction to do just that.

First, the bad news. The monthly unemployment rate in Mesa County spiked at 9.2 percent in January, the latest month for which estimates are available.

The increase wasn’t surprising since jobless rates in the county historically climb to their highest level of the year in the first month of the year. There’s some consolation in the fact the rate has been higher still in January in each of the previous three years. Moreover, such other labor indicators as unemployment insurance claims and job orders posted at the Mesa County Workforce Center reflect slowly improving conditions. However, the gap between the unemployment rate in Mesa County and the statewide jobless rate isn’t getting any narrower.

For January, the state rate actually dropped two-tenths to 7.3 percent.

At the same time, sales tax collections for Mesa County and the City of Grand Junction continue to trend downward, decreasing on a year-over-year basis in six out of the last seven months. Sales tax collections not only offer a measure of local sales, but also constitute an important revenue source for local government operations. And the declines in collections in Mesa County and Grand Junction stand in contrast to the gains reported elsewhere in Colorado.

No doubt the higher unemployment rate and resulting decrease in wages affect sales. Slowing in area energy development likely has had an economic effect as well as exploration and production activities shift away from Western Slope natural gas to the oil found in formations elsewhere in Colorado and other states.

Fortunately, 2013 is only a quarter of the way through, offering ample time for trends in unemployment and tax collections to change. Hopefully, they will.

Meanwhile, the necessity of any and all efforts to help entrepreneurs start and grow businesses remains clear. Now, the good news. Efforts at the Business Incubator Center, long hailed as a model for that endeavor, were validated once again with the recent selection of the center as one of two finalists for an Incubator of the Year Award from the National Business Incubator Association. The winner will be announced during the association’s upcoming conference in Boston.

Those familiar with the many programs and services offered at the Business Incubator Center know the operation justly deserves selection as Incubator of the Year every year. But the cumulative contributions of the center to the local economy become even more impressive when viewed over its 25-year history. During that time, the center has helped launch more than 260 companies and helped fund more than 330 companies. Those firms in turn have created nearly 10,500 jobs, invested more than $58 million in capital and generated more than $156 million in revenue.

Here’s the obvious moral of the story: When the going gets tough and remains that way, the tough look for ways in which to help change the circumstances.

The Business Times has served as the definitive source for Grand Junction business news since 1994. The journal offers news, views and advice you can use twice each month in print with daily updates online at www.TheBusinessTimes.com
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Posted by on Mar 26 2013. Filed under Editorials, Opinion. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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