Colorado’s job growth in 2026 is weaker than expected, according to a report from CU’s Leeds School of Business.
CU economists cut their forecast from 17,000 new jobs this year to 6,000. Weak employment in retail and leisure and hospitality jobs are the main reasons for the slimmed-down expectations, said CU economist Brian Lewandowski.
The leisure and hospitality bucket captures hits to the state’s resort towns from the lack of snow this winter.
“Think about the tourism industry over this past winter and what they were dealing with from snow conditions to trouble finding workers to international disruptions where some of our international visitors didn’t come … The tourism industry just got hit by many things to where it just led to softer employment growth or even a slight decline when we thought it would be a little bit better than that,” Lewandowski said.
Statewide, retail sales are not keeping up with inflation, he said. That tracks with less demand for retail workers.
Colorado’s job market has been sluggish for more than two years relative to the U.S. Last year, the state lost jobs for the first time since 2010, excluding job losses during the COVID-19 pandemic.
It’s difficult to pin down one reason for why Colorado’s job market is stalling after sitting near the top of the pack among states for the better part of a decade. But one data point jumps out, according to the CU economists. In June, Colorado’s labor force shrank by 64,900 people from the same time last year.
A lot of other states are also seeing a shrinking workforce, Lewandowski said. But the decline in Colorado was among the steepest in June, he said.
Colorado has seen a slowdown in people moving from other states, as well as an increase in people leaving the state. Additionally, President Donald Trump’s aggressive push to increase deportations is almost certainly having an impact on the labor force nationwide, although it’s difficult to tease out how large of an impact, according to Lewandowski.
One thing is clear, he said. It’s very difficult to add jobs with a shrinking labor pool.
“We’ve got this labor force headwind where if we don’t have population growth in the labor force, why would we expect to have job growth like we did a few years ago or a decade ago?” Lewandowski said. “And so why are people chasing other states or not chasing Colorado? And is it a cost of living issue? Is there something more? But … if we don’t have that supply of labor, how do we maintain growth on the job front?”
Lewandowski forecast job growth will pick up in 2027.
“I still don’t think it’ll be phenomenal job growth,” he said.
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