Economic report paints grim picture of Colorado’s rapidly growing industries

Bell Policy Center expects to release its findings about wage stagnation and other factors squeezing Colorado workers Friday in its new Guide to Economic Mobility in Colorado report

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A dusty cloud from a Brighton Boulevard construction site is illuminated by late-afternoon sunlight. Dec. 12, 2017. (Kevin J. Beaty/Denverite)  rino; five points; brighton boulevard; kevinjbeaty; denver; denverite; colorado;

A dusty cloud from a Brighton Boulevard construction site is illuminated by late-afternoon sunlight. Dec. 12, 2017. (Kevin J. Beaty/Denverite)

A draft version of the Bell Policy Center’s new report on economic mobility originally included an illustration of average weekly wage growth in Colorado from 2000 through 2016.

“They said, ‘Take this graph out because all it is is a straight line going across the page,'” said Rich Jones, director of policy and research at Bell Policy Center. When adjusted for inflation, average weekly wages rose about 3 percent or $33 since 2000.

Bell Policy Center expects to release its findings about wage stagnation and other factors squeezing Colorado workers Friday in its new “Guide to Economic Mobility in Colorado” report. The progressive nonprofit makes several recommendations lawmakers could take to ease the pressure on employees throughout the state.

Overall, the economic mobility report paints a grim picture about the situation Colorado workers are in, the jobs being added to the state and the future of labor going forward.

The data explains why we see opinion polls and hear people saying, “Hey, I’m feeling really stuck. I’m feeling like I can’t keep up with the costs,” Jones said. “Since we’ve come out of the Great Recession, in the past five to six years there’s been a phenomenal increase in housing costs. … That’s really squeezing a lot of people.”

The numbers

During 2016, almost one in four workers — 500,000 Coloradans — worked in an occupation with median wages that were unable to keep a family of four out of poverty, according to the new report.

The average household size in Colorado is 2.44 people for renters and 2.62 for people who own their home. A family of four is used as a benchmark. It could be easier for smaller households to get by with less income and more difficult for larger families.

“The thing that is important is to look at is the percentage of our workforce that’s in those low-wage jobs,” Jones said. “In 2004, we had 13 percent of the workforce that was in those jobs. In 2016, it was 22 percent.”

Colorado is adding more low-wage jobs than any other, according to the report.

Four of the seven industries projected to create the most jobs through 2026 — educational services, other services, retail trade and accommodation and food services— pay an average wage below 200 percent of the federal poverty level for a family of four. That $49,200 mark  is a being used as the threshold for a family of four to be able to support itself.

Plus, Bell Policy Center found that as many as 477,000 Colorado workers in low-skill, low wage job could be impacted by the national move toward automation.

Governor Hickenlooper addresses the press in his office a week ahead of his state of the state address, Jan. 4, 2017. (Kevin J. Beaty/Denverite)

Governor Hickenlooper addresses the press in his office a week ahead of his state of the state address, Jan. 4, 2017. (Kevin J. Beaty/Denverite)

Suggested solutions

Economists continue to project that the state’s low unemployment rate, 2.9 percent in November, will push wages up. Bell Policy Center predicts that the minimum wage increase passed in 2016 will also put positive pressure on wages. The nonprofit worked on the campaign for Amendment 70.

Bell Policy Center suggests that legislators allow Denver and other local municipalities to set their minimum wages higher than the state level. The organization did not immediately say which lawmakers were considering carrying that policy change forward.

A second recommendation is that Colorado set its own wage standard for qualifying for overtime pay.

The federal Fair Labor Standards Act requires most workers in the U.S. be paid one and a half times their regular pay when they work more than 40 hours in a week. However, many full-time managerial and administrative staff making $23,660 or more per year are exempt from the overtime provision, the report states.

While waiting around for help from legislators is fun, Jones said there are a couple options for workers who want to see pay increases come a little faster.

“Having workers go and ask for raises would be helpful. There has been a reluctance on the part of employees from doing that based on what economists and others in the market have said,” he said. “Some of that’s still a little bit of a hangover from the Great Recession.”

“It was such a traumatic downturn, such a significant downturn that there are still a lot of workers out there who say, ‘Man, I got a job. I may not be making much, but I’m happy I got a job, and I don’t want to push it too far,'” Jones added.

The other option he suggested is workers find something new they like among the higher-paying, in-demand jobs and go get the skills and training to get one of those positions.

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Business & data reporter Adrian D. Garcia can be reached via email at agarcia@denverite.com or twitter.com/adriandgarcia.

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