Wobbekind provides positive economic forecast for 2016

BOULDER — University of Colorado economist Richard Wobbekind presented an upbeat forecast for Boulder and Colorado for 2016 saying the biggest challenge for the next five years will be finding talented workers to fill new jobs.

The majority of economic indicators were trending upward at the end of 2015 and are expected to stay on track for 2016 while inflation will be kept in check, said Wobbekind, the executive director of the business research division at CU’s Leeds School of Business.

SPONSORED CONTENT

How dispatchable resources enable the clean energy transition

Platte River must prepare for the retirement of 431 megawatts (MW) of dispatchable, coal-fired generation by the end of the decade and address more frequent extreme weather events that can bring dark calms (periods when there is no sun or wind).

Concerns going forward include cost of housing, availability of labor, price of oil and median family income.

“There’s not enough negative to curtail the good that’s going on,” Wobbekind said Wednesday during his forecast, “Headwinds & Tailwinds,” at the Boulder Economic Council’s 2016 Economic Forecast: Boulder & Beyond.

He pointed out that trade growth, a rising but still low inflation rate are producing healthy balance sheets for companies. “The only balance sheet not looking good is the federal government’s,” he quipped.

Wobbekind expects a 2.6 percent increase in gross domestic product, short of the 3.5 percent or 4 percent economists would like.  “That will be enough to support job growth,” Wobbekind said, but added that the expected exodus of experienced baby boomers retiring from the workforce will make it difficult to fill skill positions as companies grow and more enter the state.”

The workforce conundrum is reflected in low unemployment rates in 2015 and the fact that Colorado is outperforming the nation in employment growth. Another challenge is that some people along the Front Range struggle with an increased cost of living, mainly due to higher housing and health care costs. But Wobbekind said it’s all relative.

“Companies in California think Colorado is less expensive, while companies in Michigan think it’s too expensive,” he said.

Home prices grew 12 percent in Colorado, a result of a tight foreclosure market and under production of housing, Wobbekind said. The high cost of housing in Boulder County affects companies in the service sector trying to find workers. Wobbekind said tech companies and skilled construction tradesmen, like finish carpenters, are difficult to find.

Household wealth in Boulder County is at an all-time high and household debt is at an 35-year low, but Wobbekind said sagging median household  incomes “raise issues of haves and have nots.”