Hiring in Colorado slowed sharply in May after a big surge in April, continuing a yo-yo pattern in monthly job gains this year, according to an update Friday from the Colorado Department of Labor and Employment.
Between April and May, employers in the state added 5,400 nonfarm payroll jobs on a seasonally-adjusted basis, including 200 in the government sector. That brought the total number of nonfarm jobs in the state to 2,855,400. Between March and April, employers added a revised 16,000 jobs, up from the initial estimate of 14,600 jobs added.
One explanation for the reduction is that higher interest rates and a ramp-up in consumer inflation, which is running at a four-decade high, are starting to weigh on the economy. Retail jobs, which are more sensitive to lower consumer spending, fell by 4,800 last month, not too far off from the 5,400 jobs gained overall. Retail employment also fell nationally.
“That is something to watch for,” said Ryan Gedney, a senior labor economist with the state, on a press call Friday morning.
But Gedney also said the number of net new jobs gained has consistently moved from the single-digit thousands to the mid-teen thousands each month this year in Colorado. If June shows another big surge like April, then what happened in May will hold to the pattern. If not, a new trend might be starting.
The supersectors with the biggest gains last month were professional and business services, up 3,000; leisure and hospitality up 1,800, and manufacturing, up 1,000. Since losing 374,500 jobs in March and April 2020, Colorado has added 410,300 nonfarm payroll jobs, which represents a job recovery rate of 109.6%. That exceeds the U.S. job recovery rate of 96.3%. All metro areas in the state have regained the jobs lost during the pandemic with the exception of Greeley and Weld County, where the recovery rate lags at 58%.
Colorado’s seasonally-adjusted unemployment rate in May fell to 3.5% from 3.6% in April, dropping below the U.S. rate of 3.6% for the first time since last October. Colorado’s unemployment rate is tied with West Virginia for the 28th lowest spot among states.
The labor force, which represents those working or actively looking for work, rose by15,400 in May to 3.24 million. The share of working-age Colorado residents who are working or looking for work climbed to 69.4% in May, the highest level seen since 2012. Colorado has the second-highest share of its population engaged in the labor market of any state after Nebraska and is far ahead of the U.S. rate of 62.3%.