October 2007
Business rankings and industry clusters garner national attention
Metro Denver’s business rankings and several Colorado industry clusters gained national attention in September, according to data compiled by the Metro Denver Economic Development Corporation (Metro Denver EDC) in its Monthly Economic Summary for October 2007.
Metro Denver is the nation’s second best center for business, according to a report by the business Web site MarketWatch.com. The report ranked the nation’s 50 largest metropolitan areas based on concentration of company headquarters, unemployment rate, population growth, and other criteria. Metro Denver also performed particularly well in the small business rankings.
“This report is recognizing what we’ve known all along – that Metro Denver’s highly educated workforce, entrepreneurial attitude, and healthy quality of life make strong companies and industries grow,” stated Patty Silverstein, chief economist for the Metro Denver EDC.
A report released by the Metro Denver EDC revealed that Colorado’s aerospace economy has propelled to the nation’s No. 2 position for private aerospace employment. With 26,650 people employed in aerospace throughout Colorado, the state’s direct industry employment grew 12.9% from 2006-2007, compared to a 0.8% growth rate nationwide. The state has nearly 26,700 private aerospace workers, second only to California’s 68,400 aerospace employees.
In the beverage industry, Colorado brewers manufactured the most beer in the nation. A report commissioned by the Beer Institute and the National Beer Wholesalers Association stated that California held the top production spot since 1995, but Colorado out produced California by nearly 600,000 barrels in 2006. Additionally, Coors Brewing Company introduced a new subsidiary, AC Golden Brewing Company, which will target the craft beer market.
The state also gained recognition in the clean energy realm when plans for a large solar panel production facility by AVA Solar were unveiled. The plant, employing up to 500 people, is scheduled to open in the Fort Collins-Loveland area next year and will employ a new, low-cost production technology.
Software development company McKesson Information Solutions finalized a lease on a 125,000-square-foot office in Westminster’s Westmoor Technology Park giving Metro Denver’s information technology industry a boost as well. The company is expanding and consolidating its Broomfield and Louisville facilities, and it expects to add 700 jobs at the new facility over the next three years.
Metro Denver’s job count grew by 1,300 positions between July and August. Despite slower job growth throughout the summer, metro area employment through the first eight months of 2007 was up 1.8% over the same period last year. Within the metro area, the Boulder-Longmont MSA had the strongest year-to-date job gain (+3%), followed by the Denver-Aurora MSA (+1.6%). Through the eight months ending in August, Colorado’s entire economy had a job growth increase of 2% over the same period last year, which was higher that the national gain of 1.4%.
The second quarter industrial report by CB Richard Ellis noted a rapidly tightening market in Metro Denver. Lease rates increased for the eighth consecutive quarter, rising to $5.56 per square foot from $5.44 in first quarter. Vacancy rates also declined between first and second quarter, slipping from 6.44% to 6.18%. In this environment, industrial construction activity has increased rapidly. Construction activity increased 27% between first and second quarter, and second quarter’s activity represented an 88% increase over construction activity in second quarter 2006. That places 2.9 million square feet of industrial space in the pipeline, and three major projects – Stapleton North by Prologis, Mountain West Business Park, and Airways II –account for more than 1.7 million square feet of that space.
Recent economic data for Metro Denver reveals that 12 of the 18 indicators moved in a positive direction for the month, up from 10 indicators moving in a positive direction last month, suggesting that the strengths of the local economy currently outweigh its weaknesses. While record foreclosures and an accelerated slump in new residential construction could be affecting downward trends in consumer confidence and hiring expectations, unemployment remains low and retail sales are strong. Thirteen of the 18 indicators had positive annual changes, the same number recorded last month.
The Monthly Economic Summary provides a snapshot of metro area economic activity, as well as its relationship to national and regional economic trends.