The economic indicators for Colorado were a mixed bag in October, according to the business conditions index from the Goss Institute for Economic Research.
While the state’s economy continues to grow, telecommunications companies are cutting jobs, and manufacturing for durable goods have slowed, said Dr. Ernie Goss, director of the institute.
“Non-durable goods producers are experiencing expanding business activity while durable goods manufacturers reported somewhat slower growth. Telecommunication firms in the state continue to reduce employment in the state,” said Goss.
Overall, the entire mountain state region – made up of Colorado, Utah and Wyoming, has seen growth above neutral levels for 36 months straight. After dipping below neutral in June, July and August, national numbers also rose in October.
The overall index, or Business Conditions Index, which ranges between 0 and 100, advanced to a healthy 58.6, but down from September’s 61.0. An index of 50 is considered growth neutral. The overall index is a mathematical average of indices for new orders, production or sales, employment, inventories and delivery lead time.
“Improvements in the housing sector and expansions linked to energy pushed the index into a healthy range for October. Even so, the gains from energy for October were not as significant as in previous months. The region continues to grow at a pace significantly above that of the U.S. with the October index for the nation coming in at 51.7,” he said.
Employment: The employment index once again climbed above growth neutral. The hiring gauge slipped to a still healthy 57.6 from 58.0 in September.
“Over the last three months, employment growth in the region has remained healthy but weakened slightly,” Goss said. “Annualized job growth for the next three to six months will be above 1 percent but below pre-recession advances of more than 2 percent.”
Wholesale Prices: The prices-paid index, which tracks the cost of raw materials and supplies, rose to 71.8 from September’s 71.1.
“The Federal Reserve’s latest stimulus, quantitative easing 3 (QE3), and regional drought conditions are pushing the wholesale price gauge well above acceptable levels. I expect this to show up in higher consumer prices in the months ahead. This will limit the Fed’s options regarding further monetary easing,” he said.
Trade: The new export order reading for the Mountain States region increased to a solid 58.3 from September’s 56.6, while October imports climbed to 58.7 from 57.3 in September. “We are seeing some benefits of the Fed’s weak dollar policy which has made U.S. and regional goods more competitively priced abroad. At the same time, regional growth continues to encourage greater imports,” said Goss.