Five Factors to Consider When Looking at Colorado’s Record-low Unemployment Rate
By Dominica Gonzalez
CFI Intern
In April, Colorado’s unemployment rate fell to 2.3 percent which is the lowest it has ever been in the last 40 years, the lowest in the nation and well below the national average of 4.3 percent. However, there is still work to be done so that all Colorado communities can thrive. Here are five things to consider when looking at that record low unemployment rate.
1. The job market is unequal across race, gender and different regions of the state.
Statewide average unemployment rates aren’t the whole story. Huerfano County has an unemployment rate of 4.5 percent as opposed to Denver, where the unemployment in April was 2.1 percent. In Colorado, the African-American unemployment rate is 4.8 percent and the Latino/a unemployment rate is 4.7 percent. The unemployment rate for Latina women is 6.2 percent.
2. Underemployment vs. unemployment
Our economy is at its best when we utilize the full skillset of all citizens. However, 35 percent of minimum wage workers in Colorado have attended college. Also, the unemployment rate does not include workers who work part-time for economic reasons, such as those who cannot work full time in order to take care of a family member. In addition, this rate does not include those who have struggled to find a job, so they give up seeking work. Adding in these two factors, the underemployment rate is 6.9 percent
3. Wages are not keeping pace with cost of living.
Not all jobs are created equal. The unemployment rate looks only at Coloradans with a job; it makes no distinction between a job that pays $10 an hour or one that pays $30 per hour. The record low unemployment rate belies the struggle to afford the cost of living for many Coloradans. This is particularly apparent in the Denver area. The high cost of living in Denver makes it unaffordable for home healthcare workers, janitors and much of the service industry from affording Denver. The average rent for a two-bedroom apartment in the Denver metro area was $940 in 2013 and increased to $1,227 at the end of 2016. That is a 31 percent increase in 3 years. But the average wages for healthcare workers in Denver only increased 3 percent over that same period. More than 25 percent of the Colorado workforce makes less than $12 per hour. That means those workers make between $1,488 to $1,920 a month before tax, which makes it difficult for them to afford the average monthly rent.
4. Minimum wage increase 2017
Due to a vote on November’s ballot, the minimum wage jumped from $8.31 to $9.30 in 2017 and will increase to $12 by 2020. Despite cries that the bump in the state minimum wage will cause businesses to fire workers, this doesn’t seem to be slowing the Colorado job market down. According to a recent Denver Post article, Colorado has a highly competitive employee market, and recruiters are advising companies to hire quickly. With rapidly rising rents, a minimum wage increase was a big help for low-income Colorado families, but money is still tight.
5. Full employment is no longer the only goal
Since the Great Recession in 2009, the focus has been on getting back to full employment. We are there! Now we should turn our effort to making sure all Coloradans have a livable wage and aren’t one illness, birth or parent sickness away from losing their jobs.
