Denver Industrial Market Report Q3 2020

Like many parts of the country, the pace of Denver's job recovery has slowed somewhat. In July, the metro area added about 12,000 jobs after adding about 40,000 jobs in both May and June, according to the latest monthly data from the Bureau of Labor Statistics. The nonfarm unemployment rate dropped to about 8%, outperforming the national average, bolstering Denver's status as a consistent outperformer irrespective of the macro environment. Denver was also among the first metros to fully recover jobs lost from the Great Recession.

Initial unemployment claims in Colorado have climbed past 550,000 since mid-March as the pandemic has wrought economic damage across job sectors, specifically in retail, leisure and hospitality, and energy. But the latest weekly jobless claims suggest the worst is in the rearview mirror. In the week ending on June 6, just under 13,000 initial claims were filed for the second straight week. Continuing jobless claims as of May 23 were at about 245,000, down from over 265,000 in the prior week.

The economic impact of the pandemic and shelter-in-place orders in April dwarfed that of the Great Financial Crisis, which spanned several years. From 2008-09, Denver lost about 67,000 jobs, or about 100,000 fewer than reported last month.

The last time oil prices fell this low in 2016, the local economy felt the impact. An oil price war between Saudi Arabia and Russia caused prices to plummet to $20 a barrel in March. The fallout of the demand shock caused by the coronavirus led to oil prices hitting all-time lows in April, even after the U.S. and Mexico agreed to cut oil production along with OPEC+. Oil markets rebounded in May, hovering around $30 per barrel.