Experts: Greeley, northern Colorado economies have positive outlook for 2017
January 25, 2017
About the forecast
The Northern Colorado Economic Forecast is held annually to inform local businesses and professionals about the economic outlook for the region and state.
This year should be a promising one for the economy in northern Colorado even though a few sectors in the region face uncertainty under the new Donald Trump administration.
That's the message experts in banking, health care, real estate and agriculture shared with the few hundred people gathered in the University of Northern Colorado's University Center on Wednesday afternoon for the Northern Colorado Economic Forecast. BizWest Media sponsors the annual event.
Rich Wobbekind, a keynote speaker and executive director for the Business Research Division at the University of Colorado-Boulder, said the agriculture sector will continue to face challenges for another year because of low commodity prices, but northern Colorado's prominent energy sector is finally seeing a turnaround.
"I understand some people feel a little bit down after the last two years as to what's happened in the energy sector," he said. "We think that's done, and we think we're going to go the other direction on that."
Wobbekind noted Colorado is in the top 10 states for job growth, dropping from a top-five place in previous years. He said the Greeley and Fort Collins-Loveland areas are the two fastest growing places in the state when it comes to employment. Still, Weld and Larimer counties sit below the state's average in annual wages, according to 2015 data. He said the Front Range accounts for 96 percent of the state's population growth.
Wobbekind said unknowns about interest rates, global growth, commodity prices, the value of the dollar, weather conditions and policies under the Trump administration represent his primary concerns this year.
Here are some of the key points from other local experts who presented at the Economic Forecast luncheon:
Keith Dickelman, a banking and finance expert from Guaranty Bank, said he expects less regulation for the nation's banks going forward. He spoke about what economists are calling a "Trump bump," which explains the spike in the financial industry since the president's election in November.
Dickelman's main concern was about the housing market in Colorado since interest rates are expected to rise. However, he said as long as they stay below 5 percent, the housing sector should remain steady.
"That 'Trump bump' has helped us," he said of the northern Colorado economy. "We're going to have about three more years of good, solid, consistent growth."
Kevin Unger, CEO of Poudre Valley Hospital and Medical Center of the Rockies, expressed a lot of uncertainty for the health care sector in Colorado because of the likely repeal of the Affordable Care Act. He was unsure whether a replacement would be more effective, since about 14 plans are in the works under the Trump administration, with no hints of what will emerge.
He did note, however, under the Affordable Care Act, the uninsured rate went from 17 percent to 6.7 percent, and if the act were not replaced, about 18 million people across the nation would be left without any insurance.
"If there is ever a time when there's uncertainty in health care, today is that day," he said.
Don Shawcroft, president of the Colorado Farm Bureau, said the agriculture sector is "cautiously optimistic" about new policies under Trump's administration.
He said regulatory reform and tax reform are topics to be optimistic about, while trade policies and labor in agriculture are areas of concern.
For example, he said the administration could help by easing on environmental limitations, yet hurt by pulling out of the Trans-Pacific Partnership and by implementing immigration policies that affect a large chunk of ag workers.
"We are encouraged by the possibilities of changes in regulations … but on the other side we are definitely concerned about trade and what the future is, particularly given the price of commodities," Shawcroft said.
Matt Vance, director of research and analysis for the Colorado Branch of CBRE, the world's largest commercial real estate services firm, said the state can expect deceleration in the sector's growth through 2019.
He noted the state's real estate growth will slow, but he said the outlook will remain positive in commercial, industrial, office and retail markets.
He said a hard stance from Trump on immigration could affect the multifamily market, as a demand for housing would probably not be as prominent.
"Depending on how this all shakes out with the different policies being imposed by the administration, it's possible that we do see an extension to the (economic) cycle," Vance said. "We certainly don't see a cliff ahead of us. We see gradual deceleration, if anything."