How does Colorado balance in-migration with high unemployment?

Behind the raw numbers, a changing picture of how we work

| Jan 28, 2010

It’s an interesting dilemma for Colorado.

Population growth, natural as well as an in-migration from other states, vs. continuing job losses and a state unemployment number that isn’t improving much.

It happened in 2009, it’s forecast for 2010. But is it a problem? I couldn’t help but wonder during a recent economic forecast by CU economist Richard Wobbekind in Boulder.

CU economist Richard Wobbekind

CU economist Richard Wobbekind

More people, disillusioned with worsening economies and few good jobs in their own states, continue to pack their bags and head to the hills – our hills, namely the Rocky Mountains.

Colorado’s population increased by about 72,000 in 2009. Of that, about 32,000 were people moving in, according to CU business researchers.

This isn’t something new, of course, for bountiful Colorado. We’ve had substantial net migration since the end of World War II, about 880,000 people between 1950 and 1990. We had another net gain of 359,000 in domestic migration and 58,000 in international migration from 1990 to 1998.

This year, CU economists think the state will continue to attract people – more than 88,000, taking our total population to about 5.17 million. Colorado topped the 5 million mark in population in 2008 and continued to grow right through the recession.

Colorado’s unemployment rate rose slightly in December to 7.5 percent; in December 2008 it stood at 5.8 percent. Our numbers are better than many states, but experts all say the real unemployment figure is certainly higher, easily double digit since many people who’ve now lost their job benefits are simply dropping off unemployment roles.

So I wondered about this. More people continuing to move in – that’s a good thing, perhaps, for home sales and rentals. But if they can’t find jobs, what are they going to do?

I asked this directly to economist Wobbekind, who had made the point in his speech that a drop-off in jobs combined with more people coming in would add another “pressure” point to the state’s wobbly economy.

For 2010, the CU business team forecast that the state would actually end the year with another net loss of jobs, after losing some 100,000 jobs in 2009. Unemployment, they predict, may climb to 8.1 percent.

A few other key factors don’t bode well either for Colorado’s immediate future.

  • The recession has cut into the state’s overall “intellectual power.”
  • Social services are being squeezed throughout state and local governments.
  • Diminishing tax revenues are casting a big shadow over education funding, with cuts imminent.

So how might these conflicting numbers of higher in-migration of people without enough jobs for newcomers, let alone the people who live here, somehow be justified in the many ingredients that get stirred into the economic stew every day?

Wobbekind offered me a few possibilities, stressing that these are “possibilities” because they aren’t typically measured in key economic indicators. The new census might be more revealing, as it digs into just who is living here.

  • One, there’s strong evidence that the number of “self-employed” workers is increasing. As people have lost jobs or decided to break out of the corporate world and strike out on their own, many are working from home, contracting for their services and just not showing up in measurable ranks of employment.
  • Two, several people in a household are living off the income of a single worker. In other words, one person may have been hired, and the entire family of four or five moved here, adding to the net migration number.
  • Three, it’s also possible someone in a new Colorado household continues to hold down a job in another state, but is able to commute or even work virtually on that job. I personally know of one woman, laid off from her job in Colorado, who recently accepted a position out of state but as a Web editor on the Internet, so she’s able to continue to live here.

No doubt, as technology continues to drastically alter the landscape of what jobs are looking like in the new decade, economists and researchers are going to have to figure out how to adjust their numbers accordingly.

Or, if the state’s job picture does not improve, as happened in past Colorado downturns – the “in” migration may suddenly turn to “out” migration.