Colorado continues to recover from the COVID-19 pandemic in terms of job growth and other economic indicators, according to the latest findings in a quarterly report. But challenges remain, among them rising inflation.

“Like many Americans, Coloradans are experiencing high inflation and rising prices for goods and services. These are challenging times for working families making tough choices between filling up the tank, paying bills and putting food on the table. And Colorado business owners must contend with the rising cost of operating expenses,” said Jena Griswold, Colorado secretary of state.

Rich Wobbekind, senior economist and faculty director of the Leeds Business Research Division at the University of Colorado at Boulder, agreed. “Colorado business leaders cited inflation as one of their top concerns in the latest business confidence index.”

The Leeds Business Research Division compiles a quarterly business and economic indicators report in conjunction with the Colorado Secretary of State’s office.

According to the report for the first quarter of 2022, Colorado added 389,400 jobs between May 2020 and March 2022, exceeding the 375,200 jobs lost between February and April 2020 because of the pandemic and related restrictions. 

Nonfarm payrolls increased 131,200 between March 2021 and March 2022, a gain of 4.9 percent.

The labor force participation rate — the share of the population working or looking for work — stood at 68.7 percent in February, third highest nationally. The statewide seasonally adjusted unemployment rate slipped three-tenths of a point in March, but at 3.7 percent remained above the national jobless rate of 3.6 percent for April. 

Gross domestic product, the broad measure of goods and services produced in the state, increased 6.3 percent between the fourth quarters of 2020 and 2021.

A total of 43,780 new business filings were recorded during the first quarter of 2022. That’s up 22.9 percent from the fourth quarter, but down 2.1 percent from the first quarter of 2021. For the 12-month period ending in March 2022, 156,865 new filings were recorded. That’s up 5.1 percent over the same span a year ago. New filings constitute a leading indicator of subsequent  business and job growth.

A total of 191,846 renewals for existing entities were recorded in the first quarter of 2022. That’s an increase of 15.3 percent over the fourth quarter 2021 and 10.3 percent over the first quarter of 2021. A total of 675,536 renewals were recorded in the 12-month period ending in March 2022, an 8.1 percent increase over the span last year.

At the same time, the Consumer Price Index in the Denver-Aurora-Lakewood region increased 9.1 percent in March compared to the same month last year. That exceeds the 8.5 percent
year-over-year gain nationwide. Core inflation rose 8 percent in Colorado compared to 6.5 percent nationally.

Home price growth in the state increased 18.2 percent on a year-over-year basis in the fourth quarter of 2021. Monthly retail gasoline prices in Colorado increased 32.9 percent year-over-year in April, reaching $4.04 per gallon.

More concerned about inflation, supply chain issues and international conflicts, Colorado business leaders were less optimistic heading into the second quarter. The Leeds Business Confidence Index dropped to 53.9. That’s 4.1 points lower than the reading for the first quarter and 10.5 points lower than the reading for the second quarter of 2021. The reading for the third quarter of 2022 slipped further to 53.3. Readings above 50 reflect more positive than negative responses, however.

“The good news is that Colorado’s economy is in recovery mode,” Griswold said. “The state’s job recovery is above pre-recession levels, and our labor force participation rate ranked third-highest in the nation in February. We must continue to do all we can to support Colorado’s small businesses and the working families that are the backbone of our economy and communities.”