Steamboat Springs Several key indicators point to a continued, but slow, economic recovery for Routt County, with gross retail sales and unemployment numbers expected to improve during the second quarter.
Scott Ford, a local economic analyst and an adviser for Yampa Valley Data Partners, said the group’s second quarter economic forecast gives reason for optimism in Northwest Colorado.
“We’re just barely moving on some stuff, but it’s there,” Ford said Monday, referring to economic indicators like consumer confidence, consumer spending and unemployment.
Ford said one of the region’s most reliable data tools is the economic stress indicator, which analyzes the total local workforce and the number of jobs from year to year. An economic stress indicator of “zero” would reveal equilibrium between the number of jobs and the availability of workers to fill those jobs. A positive number indicates decreasing unemployment. But Ford said the number can “get too positive.”
For example, an economic stress indicator above 0.025 means there aren’t enough workers to fill available jobs. Routt County’s current economic stress indicator is 0.019, meaning labor shortages are on the horizon.
“It means it will be harder for employers to find staff,” Ford said. “To find staff, they’ll have to pay more. When you begin to pay more, it lifts household incomes but also crunches down the margins in those particular business sectors.
“Is it good news or bad news? It just is what it is. It happens.”
Ford said the county’s food services, health care and retail industries would be the first to experience any impacts of a labor shortage.
On the flip side, Ford expects gross retail sales in Routt County to be up 5.2 percent this month compared to April 2011. Yampa Valley Data Partners also forecasts a 6 percent jump in gross retail sales in May and a 6.3 percent increase in June. Much of that optimism is based on the national consumer spending poll, which continues to show steady gains in the amount of money Americans are spending per day. Second quarter consumer spending could be in the range of $65 to $70 per day, which is a $6 to $7 per day increase over the same time period last year. Similarly, consumer confidence continues a slow but steady upward climb. However, Ford cautioned that Routt County doesn’t follow national trends as closely as places like Moffat County. That’s largely because of seasonality components and tourism.
Other notes of interest from Yampa Valley Data Partners’ second quarter economic forecast:
• Median listing prices in the local real estate market may have stabilized. In March, the median listing price of a home in Routt County was $487,500, an increase of 6 percent from the same time last year. The median price remains 28 percent below the peak of October 2008, according to Yampa Valley Data Partners.
• The number of homes for sale in Routt County continues to decrease, as does the number of homes entering the foreclosure process. “The real estate ‘bottom’ in both (Routt and Moffat) counties has been reached and a recovery is slowly occurring,” the forecast reads. “Barring any significant changes on the national economy, this recovery should continue for the balance of this year. This coming quarter may also represent the best value in real estate in the Yampa Valley since 1981-82.”
While Ford expressed optimism about the current state of the local economy as well as its future prospects, he warned about comparing it to the unprecedented run-up of 2006 and 2007.
“Things are kind of improving,” Ford said. “In the big picture, the danger that we have ... is looking at late 2006 and 2007 as the ‘normal’ time. That wasn’t normal. Just like way down isn’t normal, way up isn’t normal. Our basis of comparison shouldn’t be Mount Everest.”
But what positions Routt County well for continued recovery — and more so than similar counties like Summit and Eagle — is a diversified economy that includes many location-neutral businesses.
“We are more than just one or two segments of (economic) activity,” Ford said.
For more about Yampa Valley Data Partners, visit www.yampavalleydatapartners.com.
To reach Brent Boyer, call 970-871-4221 or email bboyer@SteamboatToday.com