Colorado business is showing more signs of a recovery from the COVID-19 economic slump, according to a new CU Boulder report Colorado Secretary of State Jena Griswold released on Nov. 10.
The Quarterly Business and Economic Indicators report is prepared by the Leeds Business Research Division (BRD) at CU Boulder. The report shows 38,678 new corporations, nonprofits and other entities filed initial documents with the secretary of state’s office in the third quarter of this year.
New entities filing to begin operations increased 24.3% year-over-year and 23.9% over the previous quarter. The increase bucks a strong seasonal pattern of declines in the third quarter.
More than 150,000 entities filed for renewals, an increase of 5.9% year-over-year. Trademarks (9.0%) and trade names (17.6%) also showed large increases from the third quarter of 2019.
“While the road to economic recovery remains long, this quarter’s economic indicators report does provide reasons for optimism,” said Colorado Secretary of State Jena Griswold. “Colorado’s diverse economy has proven resilient in the past and we are positioned to recover faster than other states, provided we properly manage the ongoing COVID-19 pandemic. This report demonstrates that the foundation of Colorado’s economy is strong but we must remain vigilant with respect to the pandemic to ensure it continues to grow.”
Dissolution filings also rose significantly. However, businesses frequently file dissolution paperwork well after the business dissolves.
Next for Colorado economy
BRD monitors the secretary of state’s quarterly indicators because they are often an early indicator of jobs and business growth.
“While the Colorado economy is not back to where it was before this recession, the indicators point to a faster recovery than other states might see,” said Richard Wobbekind, senior economist and faculty director of the Leeds Business Research Division. “How long it takes to fully recover will likely depend on the status of the pandemic.”
Colorado business leaders expect the economy to continue improving, according to the latest Leeds Business Confidence Index (LBCI). Panelists indicated they were on the pessimistic side of neutral but felt far better about the economy than they did at the beginning of 2020.
Colorado’s unemployment picture continues to improve, with a rate of 6.4% in September, compared to 12.2% in April. The state was still 134,300 jobs behind where it was in September 2019.
There are 79.2% fewer oil and gas drilling rigs in Colorado than there were in October of last year, according to the Baker Hughes Rig Count, which measures active oil and gas drilling rigs. The five active rigs remain unchanged from June.
Home price growth is slowing, but still remains higher than wages and inflation, according to the Federal Housing Finance Agency.