Business filings in Colorado surge in Q4 2022 | CU Boulder Today

Business filings in Colorado surge in Q4 2022 | CU Boulder Today

Colorado finished 2022 with continued strong job growth and is outperforming the nation in many areas, according to a report released Monday by the University of Colorado Boulder and Colorado Secretary of State Jena Griswold.

The Quarterly Business and Economic Indicators report is prepared by the Leeds Business Research Division (BRD) at CU Boulder in collaboration with the Colorado Secretary of State’s office. The latest report for the fourth quarter of 2022 shows that Colorado recorded 48,806 new entity filings, marking the largest quarter in the report’s history. Enrollments increased 37.2% year-on-year and 11.8% quarter-on-quarter.

However, the arrears and dissolutions also increased year-on-year. There were 13,293 terminations in the fourth quarter, up 17% year-on-year and up 14.5% from the previous quarter.

Existing renewals remained positive, up 2.9% (171,210 renewals) in Q4 year-on-year and 4.5% quarter-on-quarter.

“Colorado has continued our upward economic trajectory,” said Secretary Griswold. “With another strong year of employment gains and continued job growth, new business entity filings growing at a record rate and inflation declining faster than the national average, Colorado continues to lead when it comes to owning and operating a business.”

Inflation in the state continued to improve but remained high. In the Denver-Aurora-Lakewood region, the Consumer Price Index (CPI) rose 6.9% year-over-year in November 2022, compared to 7.1% nationally.

In December 2022, employment growth in the state increased by 3.7% (104,700 jobs) year-over-year, good for eighth best in the country. The largest annual percentage increases came from the following sectors: other services, professional and business services, and leisure and hospitality.

Resident employment in the state (based on the household survey that includes the self-employed) increased by 100,000 (3.3%) year-over-year in December. Resident employment growth outpaced labor force growth (up 74,000, or 2.3%, year-over-year) as the number of unemployed workers declined – creating conditions that feel akin to a worker shortage.

“Businesses have been vocal about a worker shortage for years,” said Rich Wobbekind, senior economist and BRD faculty director. “What the current data shows us is that while Colorado has the second highest labor force participation rate in the nation, employers are holding onto the most available workers. These current conditions perpetuate the appearance of a worker shortage from the employer perspective.”

The state’s high labor force participation rate is driving down the unemployment rate and pushing up wages. Colorado’s unemployment rate fell to 3.3% in December, below the national rate of 3.5%.

Colorado’s per capita personal income of $75,557 ranked seventh nationally, and per capita personal income growth (7.9%) ranked first for the second consecutive quarter.

Real gross domestic product (GDP) in Colorado grew 3.2% year over year in the third quarter, the sixth highest in the nation. Real GDP in the country also grew by 3.2% in Q3.

Retail gasoline prices continue to yo-yo in the state: Prices began to normalize in late 2022 after rising earlier in the year, according to the Energy Information Administration. In January 2023, prices were $1.22 per liter lower in the state compared to the June peak, but mid-January prices were $0.92 per liter higher from late December.

You can find monthly information about key economic statistics and trends impacting the state on the Colorado Business and Economic Indicator Dashboard, launched by the Colorado Secretary of State’s office in collaboration with BRD.

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