Data, statistics and revisions. Constant revisions. Earlier this week we learned that because data has been revised, Colorado’s 2021 unemployment rates last year weren’t as high as initially reported.
Colorado appeared to be trending higher than the U.S. the whole year but the revisions reduced the state’s unemployment rate by nearly a whole percentage point in some months, making it the same or lower than the nation’s rate six out of 12 months.
And it wasn’t just the unemployment rates that changed. Colorado didn’t reach its largest labor pool after all in December. After revisions, the state’s labor force had nearly 40,000 fewer people, or 3,170,694 in December, which was even lower than the workforce in November.
The revisions are due to a change in the state’s working-age population estimate, a routine part of benchmarking at the U.S. Bureau of Labor Statistics, said Ryan Gedney, senior economist at the Colorado Department of Labor and Employment. Sometimes they’re higher than first estimated. This time, they’re lower.
“Downward revisions to Colorado’s population totals is probably the biggest driver in those labor-force estimates falling in 2020-21 after benchmarking was completed,” Gedney said.
Here’s how Colorado’s working-age population changed in 2020 and 2021:
So, Colorado didn’t grow as fast as we thought, but Gedney said he’s not too concerned. Plus, population data is revised annually so it could change again. However, if you’re like Gedney, you look at the data over the past two years. Colorado’s labor force gained 52,700 people “so the overall upward trend still holds,” Gedney said.
“And despite the revised labor force totals flattening out near the end of 2021, recall that the January 2022 labor force total grew by nearly 17,000, the largest over-the-month gain in over a year,” he said. “Additionally, the January 2022 total labor force estimate of 3,187,400 is the highest in Colorado’s history.”
What revisions changed
Back in September when federal unemployment benefits ended, Colorado’s unemployment rate fell to 5.6%. But after revisions were made several months later, Colorado’s rate turned out to be even lower to 4.7% — or 0.9 percentage point lower — and the same as the U.S. rate for that month.
In December, as the omicron variant was emerging, the state’s unemployment rate fell again — initially to 4.8%. But December’s rate was also revised this week to 4.2%, which also gets us much closer to the U.S. rate of 3.9%.
The unemployment rate is more than a tally of how many people receive an unemployment check each week, of which there were 16,783 Coloradans for the week that ended March 12.
Counting only those who get weekly checks would exclude people who’ve exhausted their benefits and are still unemployed. It wouldn’t count folks ineligible for benefits, such as gig workers. It’d ignore those who stopped working months ago to care for a family member but are now looking for a job again.
Officials instead use a survey called the Current Population Survey, which is overseen by the Census Bureau. It’s a large survey in terms of surveys, but in reality, it’s tiny — just 60,000 households per month or about 110,000 individuals. Every month, a quarter of those households are swapped out so no one one household is taking the survey for more than four months.
Add those responses together and extrapolate it with the state’s working-age population and Colorado’s unemployment figure is at 133,017 in December 2021, which is still more than prior to the pandemic, when there were 86,000 individuals unemployed.
The revisions also changed the state’s labor force participation rate, which compares the working-age population with the number of adults working or looking for work. Because the population was overestimated, the state’s participation rate is no longer at a record high.
As we now know, a lot of working moms dropped out of the labor force because they became the main caretaker for young children who were either at home learning remotely or saw their daycare providers close. Older adults over 55 also dropped out for reasons that include health concerns, difficulty finding a new job and early retirement.
Less job churn in Colorado due to higher wages
After being one of the top states for the rate of people who quit their jobs last year, Colorado workers seem to be settling into something more permanent, according to February data from payroll and benefits services company Gusto. High quit rates typically mean that workers have options and are leaving jobs for better opportunities and Colorado’s rate dropped to 3%, from 4%. The U.S. rate is now higher, at 3.1%.
Gusto lead economist Luke Pardue credits Colorado’s higher wages, which grew 90 cents an hour in February compared to an hourly drop of 40 cents for the rest of the country.
“In Colorado, we’re seeing a lot faster wage growth, which is kind of muting this Great Resignation,” Pardue said. “Employers are responding to the needs of their employees and are raising pay and able to keep them, which reduces the churn in Colorado that we’re seeing in a lot of the rest of the country.”
→ No surprise, wages are higher — Coloradans earned $3.15 more per hour in January compared to a year earlier, according to the Current Employment Statistics survey. That’s $34.27 an hour, or a 10.1% increase. Comparably, the U.S. average was $31.63. We also worked more, adding six minutes to the average work week in the past year, and now work 33.6 hours per week.
Other working bits
→ Cable company sets $20/hr minimum — Denver-area telecom Charter Communications now pays a minimum of $20 an hour. The company, which has a Greenwood Village hub, said that this isn’t just for Denver but all employees across its 41-state service area. It also has 2,500 openings, including in customer service, maintenance technicians and sales. >> SEE JOBS
→ Colorado ranks 5th for security clearance wages — According to the 2022 Security Clearance Compensation Report from job site ClearanceJobs.com, Colorado workers with government security clearance make an average of $105,174 a year, ranking the state fifth for highest compensation. Colorado is also the sixth most popular state where cleared veterans want to work. >> READ REPORT
→ 72% of workers regret quitting their jobs. Or at least they’re surprised that their new job is very different from what they were led to believe, according to a survey of 2,500 people by career site The Muse.
Question of the week: Two years after COVID disrupted Colorado’s economy, are you better or worse economically? Share your story with readers of What’s Working by emailing tamara@coloradosun.com.
That’s it for this week. Holler if you’ve got a tip to pass along about Colorado’s economy. ~tamara
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