A sizzling housing market helped boost economic output in the Colorado Springs area last year by the biggest percentage since 2010 and the second fastest in the state, the U.S. Bureau of Economic Analysis reported Wednesday.
The 2016 growth rate trailed only Fort Collins in Colorado and was twice the national average when adjusted for inflation. The Springs area's economic growth rate ranked fourth among the state's seven metropolitan areas in 2015 and was the only metro area in the state with declining output in 2014.
The area's output, which the Bureau of Economic Analysis calls gross domestic product, rose 5.4 percent last year from 2015 to $31.4 billion, up from a 3.4 percent growth rate in 2015 and the biggest annual increase since a 5.5 percent gain in 2010 amid a major troop buildup at Fort Carson.
"This is a culmination of all of the other good economic news we have seen on employment, people re-entering the workforce and wages increasing," said Tatiana Bailey, director of the University of Colorado at Colorado Springs Economic Forum. "The question is whether it will continue. I hope it keeps this up."
When the output numbers are adjusted for inflation and population growth, the gain was the first since 2011 and the biggest annual increase since 2009.
The area's real output per person - a more accurate picture of economic growth - rose 1.4 percent to $39,456 but still remains 6.9 percent below the peak level reached in 2005.
Nearly half of the area's economic growth came from the finance and real estate sector, which grew 15.7 percent last year to $5.05 billion. Other major contributors to economic growth included the educational services, health care and social assistance sector, which grew 7.8 percent to $2.6 billion and accounted for 12.5 percent of the overall growth, and the government sector, which grew at a 2.5 percent rate last year to $8.48 billion and generated 11.6 percent of the overall growth. The information and manufacturing sectors were the only sectors to contract last year.
Economic growth for the nation's metro areas rose 3.2 percent last year from 2015, down from 4.2 percent growth in 2015. Lake Charles, La., led the nation in economic growth at 8.1 percent last year, while Casper, Wyo., had the biggest decline in economic output with an 11.6 percent drop.
Fort Collins had the state's fastest-growing economy at 5.7 percent, the nation's 45th-fastest growth rate after adjustments for inflation. Colorado Springs ranked 53rd. Economic output fell last year in both Greeley and Grand Junction, by 1.9 percent and 2.3 percent, respectively, ranking in the bottom 40 among the nation's metro areas.
Economic output is the value of goods and services generated in a local economy and is calculated by the Bureau of Economic Analysis for all 50 states and 382 metro areas. The bureau calculates the output data by adding together output from all industries in a metro area.
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