DENVER – Colorado’s unemployment rate fell to 3.5% in May, down another one-tenth of a percentage point from April, as the state’s labor force participation rate continues to increase, according to the Colorado Department of Labor and Employment.
Colorado’s seasonally adjusted rate of 3.5% is now below the U.S. rate, which was 3.6% in May – unchanged from a month prior. The state’s non-seasonally-adjusted rate of 3% is markedly lower than the U.S. rate of 3.4%.
The seasonally adjusted rate is now the lowest it has been since the start of the COVID-19 pandemic. It was 2.8% in February 2020. The number of unemployed Coloradans dropped by 1,800 from April to May, for a total of 114,700 people. There were around 86,000 unemployed Coloradans in February 2020.
The state’s labor force participation rate rose to 69.4% in May – the second-highest rate nationally behind Nebraska, which has the lowest unemployment rate in the nation, at 1.9%. Colorado’s total labor force now sits at 3,240,700 people.
CDLE Principal Economist Ryan Gedney said May marked the first time since 2012 the labor force participation rate was above 69% for two consecutive months. He said that reaching the low 70s in coming months could be possible.
They employment-to-population ratio grew to 66.9% in May, which is the fifth highest in the U.S., Gedney said. It is now at its highest level since November 2019. Colorado hasn’t had a rate above 67% since early 2009.
Colorado employers added 5,400 nonfarm payroll jobs over the month, and has now added back 410,300 nonfarm payroll jobs compared to 374,500 job losses in March and April 2020, for a recovery rate of 109.6%. The private sector job recovery rate was 115.4% as of May.
The trade, transportation and utilities sector lost a net 2,700 jobs month-over-month but was the only private sector industry with significant job loss, which was driven by 4,8000 jobs lost in retail. Gedney said that sector would be one to watch in coming months to see if those losses were a one-month event or will extend into the summer.
Greeley remains the only major metro area in Colorado that has still not recovered all of the jobs lost in the first two months of the pandemic, with a recovery rate of 58%, primarily in the oil and gas industry, Gedney said.
Colorado’s inflation rate is at its highest in 40 years, but is being outpaced by the local consumer price index in the first half of 2022, Gedney said. Over the past year, average hourly earnings among Coloradans went up from $31.76 to $34.62, which is $2.67 more than the national average.
“Colorado’s strong economy continues to grow faster than the rest of the country, with more and more good-paying jobs for Coloradans as we continue our hard work to save people money and lower the costs of everyday items,” Gov. Jared Polis said in a statement. “Colorado remains the best place to live, work, and run a business, and our rapid job growth and plummeting unemployment rates continue to show our strength.”