Individual income from all sources in the Colorado Springs area rose 3.1% in 2017 after adjustments for inflation, a reflection of wage increases triggered by a tight labor market, soaring rent for real estate investors and a booming stock market, an economist said.
The 2017 gain was nearly double the 1.7% growth in 2016, but was not as strong as the 5% increase in 2015, according to a report released this week by the U.S. Bureau of Economic Analysis.
While the area’s income grew more than 5% to $33.7 billion in 2017, inflation reduced the buying power of that income by 2% for a real income gain of 3.1%.
“This is a result of both a tighter labor market and a strong stock market,” said Tom Binnings, senior partner of Summit Economics, a Colorado Springs research and consulting firm.
“I expect this kind of growth continued into 2018, given the strong economic growth the area experienced last year.”
Wages in El Paso County grew 3.6% in 2017, the biggest annual gain in 10 years, and stock prices jumped more than 25%, as measured by the Dow Jones industrial average.
Local income growth in 2017 was faster than the national average of 2.6% but below the statewide gain of 3.5%. The Springs was in the middle of the pack among Colorado’s seven metropolitan areas behind Denver, Fort Collins and Grand Junction but ahead of Boulder, Greeley and Pueblo. Six of the seven metro areas had faster income growth in 2017 than 2016 with Pueblo the only area growing more slowly.
Inflation-adjusted income per person in 2017 was up 1.2% from 2016 to $44,366 after a slight decline in 2016 but not as strong as the 3.4% increase in 2015, the agency’s report said.
The U.S. consumer price index rose slightly faster in 2017 than prices rose in the Springs at 2.1%, so the cost of living in Colorado Springs didn’t chance much when compared with the national average. The report found prices in the Springs were 99.6% of the national average, up from 99.2% in 2016 and the highest level they have been when compared with the national average since 2013.
Prices in Boulder, Denver and Fort Collins were above the national average, while prices in Grand Junction, Greeley and Pueblo remained below the national average, the report found.
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