A post-recession recovery finally appears to be on track for Colorado Springs’ struggling economy, according to a report by the Brookings Institution.
The Mountain Monitor, a quarterly report produced by the nonprofit Brookings Institution and the University of Nevada at Las Vegas, studies 10 large metropolitan areas in Colorado, Arizona, Idaho, Nevada, New Mexico and Utah. The latest report, released Thursday, examined data in the third quarter — a period that saw the Springs post its first job gains since the Mountain Monitor began two years ago. Employment expanded 0.4 percent from the previous quarter.
Though the recession’s impact on the Springs was relatively mild compared to much of the rest of the region, the recovery has been late in arriving, said Kenan Fikri, one of the report’s authors. But now, he said, “there is hope at the end of a long, hard slog.”
In October — the start of the fourth quarter and thus not included in the third-quarter report — the unemployment rate in the Colorado Springs area dropped to 9.2 percent, its lowest level in nearly two years
Still, there are warning signs. “A sustained jobs recovery continues to elude Colorado’s Front Range,” the report states. And it notes Colorado Springs’ dependence on “now-stagnant federal spending in industries like defense.” But Fikri said some other areas, including finance, construction, professional services, leisure/hospitality, retail and entertainment, look set to take off.
“If all goes well, they’ll start growing again and pick up some of the slack,” he said.
Housing prices, meanwhile, may have hit bottom; they edged up 0.2 percent in the Springs in the third quarter from the previous quarter, according to the report. At the same time, the Springs reduced its stock of foreclosure properties.
While Fikri said he doesn’t expect a robust turnaround, “housing prices can’t really fall a whole lot further. You didn’t have the boom, so they weren’t as artificially inflated as they were elsewhere in the region.”
Growth in economic output was “feeble” in Colorado Springs in the third quarter, up 0.3 percent, the report said. In terms of growth in gross metropolitan product, or GMP, the Springs ranked 86th among 100 metro areas covered by Brookings’ broader MetroMonitor report. Still, Colorado Springs is “on the brink of a full output recovery,” the Mountain Monitor found, with its economic output just 0.5 percent below pre-recession levels.