Surface Creek
Tuesday July 28, 2015

Businesses and local governments waiting for news that an economic turnaround has begun will have longer to wait, a state agency says.
A recent report by the Colorado State Demographer’s office details some of the economic challenges faced by local business and government because of population trends in  this area.

The report, given recently to local officials at a Montrose meeting, was reviewed at the Cedaredge trustees’ all-day budget workshop last week.
The headline number in the report, noted former trustee Gene Welch, was a net decline of 590 people in Delta County’s population between 2010 to 2013.
That population decline was the highest among the six counties in Region 10. Montrose County lost 436 population over the same time, and Hinsdale County lost 37 people, according to the  report. Gunnison, San Miguel and Ouray counties increased slightly. For all of Region 10, there was a population loss of 532 for the period.
But the real problem plaguing local economies of Region 10 is buried deeper in the report and underlies the economic conditions that everyone is worrying about. The leading economic sector employer in four of the region’s six counties is government — an enterprise that consumes wealth, but does not produce wealth.
In the two counties  where government is not the major employer (Ouray and San Miguel), government closely follows their top jobs industry –  the low-wage food and lodging sector.
Delta County’s natural resource-based, wealth-creating economic sectors are all under stress. Coal is suffering, from local operational problems such as an underground fire to an unfavorable national energy policy. Timber is being devastated by forest diseases, a poor market for lumber and by environmentalist opponents of active forest health management. And production agriculture is constantly looking over its shoulder at state and federal regulations and policies which threaten access to the water it needs to survive.
Closely related to the region’s economic situations is a note in the report that the U.S. economy is comprised of almost 70 percent personal consumption spending. Wealth-creating export and investment comprise less than 20 percent of the national economy.
Flat to declining population and job growth trends spell trouble for local officials as they struggle with declining budgets.
During the Cedaredge Town Board’s day-long  budget work session on July 30, Mayor Pat Means reviewed the state demographer’s report.
The state demographer’s office predicts an aging population with fewer job opportunities for young people. Job growth decreased by 2 percent in Delta County in 2012-2013, the report states.
The population of Delta County is following the statewide trend of aging, and from 2000 to 2012 real median income in Colorado has fallen by 7.6 percent (by 5.6 percent across the U.S.). In particular, projections of an aging, less prosperous population with less disposable income and less incentive to spend are key to Cedaredge.
Cedaredge is home to a retirement demographic that is looking to invest in real estate. Some believe that real estate provides the underpinning for the county’s economy. Cedaredge has tried to market itself using a variety of strategies, with limited success in attracting retirees. But it hasn’t been able to attract a demographic that is willing to invest in tax-generating business enterprise, nor in the demographic that is willing to spend money that will support those tax-generating businesses.
As local officials try to find meaning in the latest demographer’s report, it should be noted that the state demographer’s alarming warnings about high growth rate trends issued in 2007 turned out to be totally wrong.

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