Colorado employment is off to a strong start in 2016. The state added 5,200 payroll jobs in January, and the unemployment rate dipped to 3.2 percent.
"It was 15 years ago that we saw unemployment numbers this low," said Alexandra Hall, Chief Economist for the Colorado Department of Labor and Employment.
While those numbers are encouraging, economists are concerned about the impact of sustained low oil prices on jobs in the oil and gas industry.
"We were expecting those [job] numbers to be revised significantly down, and they were," Hall said. "We show a decline of 6,700 from January 2015 to January 2016."
Employment in the oil industry is down by about 7,000 jobs since the peak in December 2014, Hall said. The state’s largest oil and gas operator, Anadarko Petroleum, has announced layoffs. Encana, another company that is active in the Denver-Julesberg basin — although it has plans to sell those holdings — will also make cuts to its workforce. Hall added that Colorado is in a better position than some to absorb those sector losses. States like Oklahoma and North Dakota are much more heavily reliant on oil and gas exploration than Colorado, whose economy is more diversified.
"Colorado has seen some of the same type of job loss, but we have seen continued growth in construction that is outside of oil and gas; in fact the majority of construction employment is not due to oil and gas activity," Hall said. "We’ve also known anecdotally for a while now that construction employers have been having a hard time finding workers. So the loss in jobs in oil and gas actually leads to reduced competition for those workers for the construction industry."
Nationwide, the unemployment rate is 4.9 percent. Thirty states, including Colorado, reported job gains in Jan. 2016, while 20 states lost jobs.
