Industry experts assess local economy at 2011 halftime

LOVELAND – The Northern Colorado economy is improving, but the improvement is slow and has yet to make a sizable impact on continuing unemployment.

That was the message delivered to about 200 businesses leaders at the Northern Colorado Business Report‘s annual Mid-Year Economic Update July 21. A panel of four industry experts gathered at the Embassy Suites in Loveland to discuss the current state of the economy in Northern Colorado: H. Christine Richards, economic consultant for the Colorado Association of Manufacturing and Technology; Kevin Brinkman, president, co-founder and managing broker of Brinkman Partners; Martin Shields, professor of economics at Colorado State University; and Jerry Thurber, president of pre-employment screening firm Tandem Select. The panel answered questions posed by Business Report editor Kate Hawthorne and president of KUNC Neil Best – as well as from the audience – on the subject of the economy as a whole, with a focus on job creation and unemployment.

Shields began with a presentation on the changes that have occurred since January, giving what he called a 2011 “halftime report” on the state of economic affairs in Northern Colorado and nationwide.

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There are signs of improvement, according to Shields, in that inflation has remained subdued and interest rates low, but job growth is still the greatest challenge. Nationwide, 6 million people have now been out of work for six months or more.

“I’m not willing to accept 9 percent unemployment as the new normal,” Shields said during the question-and-answer portion of the program.

In Larimer and Weld counties, employment is 6,000 jobs below pre-recession levels, but 20,000 jobs below its potential, Shields said.

“The magnitude of the way this region has been impacted … it is profound,” he said.

Growth can be expected, Shields said, in the areas of energy, health care, professional and business services and wholesale trade, but struggles persist in government, construction, financial activities and the information sector.

The tone of the panel was cautiously optimistic, as all four panelists alluded to positive changes in their industries and in the economy overall.

Richards, who spoke on the progress of the highly anticipated ACE technology and manufacturing park currently under way at the Agilent campus in Loveland, said that tenants may begin moving into the park as early as first or second quarter 2012, and that the park may bring as many as 6,000 jobs to the area initially.

According to Richards, the park will attempt to achieve synergy between the aerospace and clean energy sectors to stimulate both local and state economies and create jobs in the region by providing the businesses that locate in the park with the tools they need to grow.

In the construction realm, while membership in local construction and real estate associations is dropping, firms who make use of current trends and use a bit of creativity have held on despite the hardships seen by the industry as a whole.

Getting involved in the apartment and rental market is one of the avenues Brinkman Partners is taking, Brinkman said. With fewer people buying homes, building apartments for lease is a logical step, as is student housing.

The construction industry is also benefiting from low material costs and low interest rates right now, according to Brinkman.

Thurber discussed the ways in which employment is changing and why the most recent recession is different from those the nation has weathered in previous decades, including the concept of internationalism.

“It is as important for Greece to turn around as it is for Colorado to turn around,” he said. More local companies are doing business overseas, making the economy in Northern Colorado more dependent on the economy in a region thousands of miles away.

Thurber also discussed the concept of the “just-in-time” worker, who is brought on for a specific project but is not necessarily a full-time employee. Such jobs allow those who may not be able to secure full-time employment to earn a living and afford businesses workers to complete jobs without the expense of a full-timer, but the effects on the traditional employee-employer relationship – including health care coverage – could be profoundly changed in the future.