Report: New Entity Filings Surge, Job Growth Slows in Colorado
Colorado鈥檚 new entity filings surged 39.1% year-over-year, according to Aug. 10, 2023, by the 麻豆影院 and Colorado Secretary of State Jena Griswold.
The Quarterly Business and Economic Indicators report is prepared by the Leeds Business Research Division (BRD) at CU 麻豆影院 in conjunction with the Colorado Secretary of State鈥檚 Office.
The latest report for the second quarter of 2023 shows that Colorado recorded 54,890 new entity filings, most of which were LLCs. Quarterly filings remain elevated but decreased by 1.6% from the record high in the first quarter.
Dissolutions improved in the second quarter. The number of dissolutions were nearly flat year-over-year and decreased over the quarter. Dissolution filings totaled 11,785 in Q2 2023 compared to 11,753 in Q2 2022鈥攁 change of 0.3%. Filings decreased 15.8% from the 14,000 recorded in Q1 2023.
Business renewals decreased over the year and over the quarter. There were 171,081 renewals in Q2 2023, a decrease of 0.6% year-over-year and 11.8% over the previous quarter. Businesses in good standing increased in the second quarter. Total entities in good standing increased 9% from the second quarter of 2022 to the second quarter of 2023, continuing a general upward trajectory.
Inflation continued to improve in the second quarter. The Consumer Price Index increased 5.1% year-over-year in May 2023 in the Denver-Aurora-Lakewood metropolitan area (MSA), while the national rate slowed to 3% in June. Core inflation, which includes all items except food and energy, increased 5.6% in the Denver region.
While Colorado remains above average in the jobs recovery from the pandemic recession, the state鈥檚 jobs growth cooled significantly in 2023.
The state鈥檚 job growth accelerated to 1.5% in June 2023, ranking the state 44th nationally. Evidence suggests this is a signal of a supply constraint rather than easing demand, as well as a data reporting issue that is understating Colorado鈥檚 job totals.
The largest annual percent increases came from leisure and hospitality, mining and logging, and government. However, losses were recorded in financial activities; information; trade, transportation, utilities; and construction.
The employment slowdown arises at the same time Colorado records the 14th-highest job openings rate, the 4th-highest labor force participation rate, the 14th-fastest growth in labor force and the highest number of people in the labor force in state history.
With an unemployment rate of just 2.8%, Colorado鈥檚 slowdown in job growth appears to be a symptom of a worker shortage rather than softening demand for workers. Other economic metrics remain positive but also suggest a slowdown in Colorado鈥檚 economy. The state鈥檚 GDP, personal income and taxable retail are posting positive but slower growth.
鈥淭he growth in establishments and strong underlying components of the labor market suggest the slowdown in job growth appears to be a labor supply issue rather than a signal of business distress,鈥 said Brian Lewandowski, executive director of the Business Research Division.
U.S. real gross domestic product (GDP) accelerated in the second quarter. Initial reports for GDP for Q2 2023 indicated 2.4% growth, up from 2% growth from the first quarter.
You can find monthly information on key economic statistics and trends that impact the state on the , launched by the Colorado Secretary of State's office in conjunction with BRD.