May: Reigniting the Northern Colorado economy
The ongoing government response to the COVID-19 health crisis has damaged the economy of Northern Colorado. Recovery is already underway. However, it is likely to take quite some time to replace the jobs and gross regional domestic product lost due to the shutdown of the economy.
The good news is the Larimer-Weld region remains a great place to live and do business, and deliberate action on our part can help foster a strong future economy.
We have the advantage of being a workbench for the Silicon Valley. To increase their capacity and reach for talent, tech companies have had operations in cities across the western United States for a long time, including here. As it becomes increasingly difficult to do business in some of those other places — think Seattle because of the new payroll tax on employers and workers — places like Northern Colorado can be attractive alternatives. There may be opportunities to move work off their “work benches” onto ours.
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Rocky Mountain Health Plans (RMHP), part of the UnitedHealthcare family, has pledged its commitment to uplift these communities through substantial investments in organizations addressing the distinct needs of our communities.
The same goes with American manufacturers. Pre-COVID-19 tensions with China already had many manufacturers realigning their supply chains. The outbreak of COVID-19 in China and the subsequent disruptions and tensions have escalated that trend. Does this represent an opportunity to “reshore” some of those companies to Colorado? Perhaps.
While those may represent longer-term opportunities, in the near-term, the lack of a vaccine for COVID-19 means a cautious public and a subsequent reduction in economic activity from previous levels. Former FDA Commissioner Scott Gottlieb has referred to this as “the 80% economy.” Pre-vaccine means an economy riding the brakes.
Adding to the uncertainty are the long-term implications of the short-term disruptions to the business models of retail, higher education, health care, accommodations and food service, oil and gas, and entertainment and recreation to name a few sectors.
Just look at one of those, higher education. Colorado State University has a huge economic impact on Northern Colorado. When the university is not functioning at full capacity, it is felt throughout the entire regional economy. Retail, residential housing, professional services, financial institutions, restaurants and bars all feel the effects. Short-term, the consequences are easy to see, but the long-term impact on the model for higher education is a big unknown but has big economic implications for the region.
This cursory review of opportunities, disruptions and unknowns sets up my main point, which is we need to be proactive, thoughtful, and intentional about our area’s future economy.
The economic recovery will be led by hundreds of individual businesses making investment and hiring decisions, and organizations like CSU being able to fully reopen safely. Business activity will pick up after the virus burns out or a vaccine is developed and widely distributed.
To understand what has happened to us economically and to determine what can be done to foster business confidence and accelerate the process of replacing lost jobs and gross regional product, a group called Reignite Our Economy was organized in late May. It’s a group of economic developers, chamber of commerce leaders and others from the Larimer County area. Reignite is coordinating with the recovery work being done through Larimer County to leverage resources and minimize overlap.
One of the initial actions was to create a group to compile and analyze data to help us understand what has happened to the regional economy. Those insights will inform the development of a regional economic recovery plan and help policy makers understand their options to support the recovery.
Obviously and necessarily, responding and reopening have been the primary focus for all of us and will be for a while. However, know that work is being done to focus on the long-term economic prosperity of the region. Reigniting and rebuilding the economy is an important focus for area leaders.
David May is the president and CEO of the Fort Collins Area Chamber of Commerce. Reach him at dmay@fcchamber.org.
