Boulder-area forecast: State, local economy slowing but resilient

BOULDER — While headwinds persist, the Colorado and Boulder-area economies are unlikely to crater in 2024, experts said on Thursday evening at the Boulder Chamber’s annual economic forecast event. 

The event, which Boulder Chamber CEO John Tayer marked as the “official kickoff to the 2024 business year,” featured presentations by Richard Wobbekind, senior economist and faculty director of the Business Research Division at the University of Colorado Boulder’s Leeds School of Business; Brian Lewandowski, executive director of CU’s BRD; and Colorado State Demographer Elizabeth Garner.

Looking in the rearview mirror, the Colorado economy “overperformed in terms of (gross domestic product) in 2023,” Wobbekind said. 

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For the new year, he predicted a “soft landing” rather than a dramatic economic pullback.  

Economic data suggests “we just aren’t really getting into recessionary territory,” Wobbekind said. Rather, the BRD expects 2024 GDP growth of around 1%.

On the macroeconomic level, inflation is “looking a little better,” he said, but that’s not necessarily the impression that many consumers have. Despite the improvement, inflation in the greater Denver region, which includes the Boulder Valley, remains higher than the national average, with housing costs playing a major role. “We continue to have a pessimistic view from consumers,” and business leaders often express similar sentiments.

Colorado job growth in 2024 is expected to be about 1.4%, down from the estimated 2.2% growth in 2023, Wobbekind said, with “sectors related to interest rates (expected) to be impacted the most.”

Boulder County, while subject to the same macroeconomic trends as the rest of the state and nation, has “a special economy” that is particularly diverse and is not overly reliant on one or two leading industries, Lewandowski said. “We are at an all-time high in Boulder County for jobs,” both in terms of total positions and workforce participation.  

Despite the “tight labor market here,” combined with slowing economic growth, “we don’t think things will completely come off the rails in 2024,” he said. 

The labor market, both in the Boulder area and across the state, is expected to continue to be impacted by demographic changes, Garner said — “everything is connected.”

Colorado businesses have “never really had to compete too hard for the best and the brightest because we have places like Boulder” that have been popular locations for relocating employees, she said. But demographic trends — increasing births, decreasing deaths and an aging population, for example — are likely to continue to put pressure on employers to attract and retain workers. 

“You attract folks from all over the Front Range to the jobs you have here in Boulder,” Garner said, but the region must reckon with the fact that young people “are not going to be entering the labor force because they were never born.”

The more rapidly businesses recognize and adapt the current demographic reality — which flies in the face of narratives that suggest workers are still “flocking” to the Centennial State in large numbers — the better, she said.

“If you think it’s bad now, it’s only going to get worse,” Garner said of population-growth trends among prime working-age populations.