Important indicators continue to reflect improving economic conditions in the Grand Valley, bolstering prospects 2015 really will be a better year for business.
But, will indicators tracking the local labor market follow suit?
Sales tax collections, a key indicator of retail activity, increased 2.5 percent for Mesa County in 2014 over 2013. At 3.4 percent, the increase was even larger for the City of Grand Junction.
Because sales tax reports lag a month behind, year-end reports for 2014 reflect sales between December 2013 and November 2014. So the full results of the latest holiday shopping season won’t be known until February. More significantly,though, the long-term trend in sales tax collections has been steadily upward. Sales tax collections in Mesa County have increased in each of the last five years. For the city, sales tax collections climbed in 2014 to their highest level since 2008.
There’s more encouraging news in the increase in lodging tax collections in Grand Junction for 2014. According to the Visitor & Convention Bureau, more than $1.25 million in lodging taxes were collected last year, a 4.3 percent gain over the year before. Lodging tax collections offer an indicator of hotel and motel stays and, more broadly, the hospitality sector.
Barb Bowman, sales and division manager of the VCB, characterizes the 2014 increase as a recovery and offers what she calls a “bullish” forecast for 2015.
Still other indicators — those for real estate — add to the growing body of evidence supporting economic recovery. A total of 3,653 real estate transactions worth a combined $809 million were reported in Mesa County in 2014. Compared to 2013, transactions edged up almost 2 percent and dollar volume rose 5 percent. The latest numbers are the highest for Mesa County since 2008.
The Grand Junction Area Realtors Association reported that the average sales price of residential property increased almost 8.8 percent to $203,148, while the average days on market fell 6 percent to 125.
Annette Miller, senior vice president of Heritage Title Co. in Grand Junction and a long-time observer of the local real estate market, describes the local real estate recovery as “lazy,” especially compared to more robust growth elsewhere in Colorado. But Miller expects a four-year trend of slow growth in Mesa County to continue in 2015.
Past performance offers no guarantee of future results. But given long-term trends for important economic indicators, it would appear that it’s no longer so much a question of if growth will continue in 2015, but how much and how fast.
But a second question persists: To what extent will the labor market also recover?
The seasonally unadjusted unemployment rate in Mesa County has increased two months in a row in part because of seasonal layoffs, but also what’s seen as the effects of slowing in energy development related to lower oil prices.
Labor demand continues to increase even as claims for unemployment benefits fall. But the jobless rate in Mesa County remains higher than the statewide rate and other areas of Colorado. Moreover, Mesa County is one of the few places where the labor force has yet to return to pre-recession levels.
Here’s hoping indicators accurately forecast better times ahead, including improvement in the labor market.