Colorado slips into nationwide recession
DENVER Colorado ” Colorado’s unemployment rate jumped to 6.1 percent in December, the highest in more than five years, as the state slipped into the nationwide recession, labor officials said Tuesday.
“There’s just no money moving through the economy right now,” said Alexandra Hall, chief economist at the Colorado Department of Labor and Employment.
Colorado’s economy entered into a recession during the fourth quarter of last year on the heels of the global banking meltdown, she said.
The December unemployment rate was three-tenths of a percentage point higher than November’s and 2.1 percentage points higher than a year earlier.
The Labor Department said the number of unemployed Coloradans rose by 7,800 to 167,600 in December, while the number of Coloradans with jobs fell 5,900 to 2.6 million.
About 47,000 Coloradans have lost their jobs in the past 12 months, the Labor Department said.
December’s unemployment rate is the state’s worst since August 2003.
The professional, scientific and technical services sector suffered the most job losses, said Hall. She attributed that to cutbacks in the number of temporary employees that businesses rely on for accounting and secretarial services.
“These jobs are always the first to go during a recession,” Hall said.
Not surprisingly, Colorado saw gains in the leisure and hospitality industry with the start of the ski season.
More than 61,000 Coloradans filed initial jobless claims in the last quarter of 2008, compared with the 56,000 who filed initial claims in the three months after the Sept. 11 terrorist attacks.
But Colorado is in better shape than many states. The national unemployment rate was 7.2 percent in December, the highest in almost 16 years.
Michigan and Rhode Island both reported unemployment rates of 10 percent or more in December.
“We’re still in a much better position than many states to handle this,” Hall said. “If there was fat to be cut, it was cut as a result of the 2001 recession.”
Colorado’s diverse economy and research and development in such areas as green technology will continue to attract venture capitalists, with the prospect of employing more Coloradans, she said.
“Charles Schwab just announced last week that they were adding 500 jobs in Douglas County,” Hall said.
State labor officials hired 50 more representatives to staff the unemployment call center and authorized overtime for employees at the center after the financial sector started to collapse in September.
“It’s a daily and continuous re-evaluation to eliminate the strain on the system,” said Cher Roybal Haavind, director of government, policy and public relations.
The department wants to extend weekday hours and add Saturday hours at the unemployment center but Haavind says that depends on funding.
“We’re hoping some relief will come with the federal stimulus package,” Haavind said.
Economists hope the stimulus package will do more than help out unemployment call centers.
“The hope is that this economic stimulus package will pull us out of the recession by the end of 2009,” Hall said.
Employment usually lags but typically starts to grow three to six months after the country begins to see growth in its gross domestic product, she said.