 Good afternoon and welcome to the 26th annual UCCS economic forum my name is David Siegel I'm the executive director here at the end center for the arts at UCCS and I will be serving as your emcee during today's event we'd like to thank all our partners who've made this event possible and we thank each of you who have taken time out of your day to be part of the event including all of our elected officials now please help me welcome Dr. Venkat Reddy chancellor of UCCS good afternoon so this is like I'm on a vacation seeing so many people at one spot it's been a long time that we actually had this many folks together and long overdue but welcome to the 26th annual UCCS economic forum it's wonderful to see you all here today and this forum wouldn't be possible without the support of many of you in this room so thank you so much for your support that we arrived at the 26th it was great to see the vibrant campus back again I started hearing the complaints about parking we can't find parking on campus so that also kind of felt good that we have faculty staff and students with smiling faces they couldn't stop smiling so we did again wait for a long time for this but it was exciting to see that that the work we do for our students is back in life on the campus so each year that we gather for this event feels different this year especially has presented us with economic challenges that have risen one after the another times like these remind me of the importance of the economic forum for giving us clarity on what's to come so I can't wait to hear what our economists have to share today so here at UCCS our role is not just respond to short-term forecasts but to prepare our students for their entire future careers that means they must be able to adapt to changing markets and industries over the course of decades so what we're doing is really giving them that foundation so that they can take care of these changes as a university we must look far into the future to determine the industries that will need their skills so I'm proud to see that three new programs recently launched at UCCS programs in social work cybersecurity aerospace engineering these fields are in need of the workforce of the future we are proud that our skilled graduates are already helping to fill critical gaps in these industries with many more on the way I'm also proud of a new two plus two partnerships that we're building with pike speak state college and other community colleges in southern Colorado these strong partnerships will help us produce more college graduates fill critical workforce needs increase diversity equity and inclusion in our programs and make more opportunities available for students who need financial support these efforts don't just help students or the university I always like to say when we help our students succeed we are helping the communities we serve succeed as well and I hope you see that every single day and research shows as that college graduates are more likely to vote more likely to lead healthy lifestyles they are more or their lifetimes and they're more likely to give philanthropic support so I'm deeply thankful of everything our community does to support UCCS and in turn I'm proud of all that we do to make our community a better place to live before I turn over the microphone I have final big thank you as you may know Tatiana Bailey executive director of the economic forum wanted to expand our horizons and want to move on to new pastures and I was fortunate to bring Tatiana to the campus when I was a dean of the business school I just want to thank her for her many years of service to UCCS and do this community so Tatiana we wish you the very best I know you're not going too far so thank you again please join me in it's my pleasure to welcome Karen Markel dean of the College of Business to this packed house it's awesome this is my first in-person economic forum and I'm just so thrilled to be here we're excited to be hosting the annual economic forum today the success of this event over the past 26 years is the direct result of the active partnership and participation year after year from our business community thank you so much for your ongoing support I'd also like to offer a special thank you to our forum founders Dr. Tom's Warline Dr. Jeff Ferguson and Ron Chernak for their vision and efforts in making this local economic forum possible since 1997 the UCCS economic forum has just but has been just one example of how the College of Business partners with the community our mission states we are prioritized and empower learners at every stage of their educational journey develop innovative research that contributes to scientific discovery and effective business practice and serve as a hub for our community in productive discourse practical learning and social responsibility the economic forum has been providing targeted economic information to drive business and government decisions to greater Colorado Springs and our academic programs aim to produce students to serve your workforce needs we have a successful history of working side by side to build the strength of the college in our region and we look forward to identifying new innovative ways to support to support our local workforce in the years to come as we all know very well from the last couple of years forecasting the next year and even the next few months as challenging that is why we all look to experts to provide insights into our economic future we look forward to hearing a timely presentation today from our forum director dr. Tatiana Bailey regarding our state and national economy as well as from a workforce development panel addressing the linchpin to sustainable economic development hosted by dr. Bailey Ron Fitch Joe Garcia Kimmel and Harris and Catherine Keegan I also want to thank all of our partners specifically our platinum partners Bank of America the FBB group Merrill Lynch and credit union and our gold partners the Community College of Aurora Pikes Peak Workforce Center and a special thank you to our media partners Colorado Springs Business Journal the Gazette and Fox 21 News we also wish to thank our nearly 50 silver and sustaining level partners not only do our partners support the forum financially but they also provide their expertise and use their business connections to help bring you an outstanding program we are grateful to host the 26th UCCS economic forum in person as we look ahead towards a very bright future in Colorado Springs I'll be back to close our event later this afternoon with some exciting announcements and a special thank you to dr. Bailey I hope you enjoy enjoy today's program thank you dr. Marble now we're pleased to share a few words from the mayor of Colorado Springs the honorable John Souther's hello everyone I'm Colorado Springs mayor John Souther's it's my pleasure to welcome you to the UCCS economic forum this is an important event where you can gain good unbiased and well-sourced data to help you plan for the future as some of you may know this is my last year as mayor after serving two terms and during that time I received my fair share of complaints but even the complaints make me feel good about our progress people used to complain about the condition of our roads they said we didn't have enough new construction not enough cranes they said young people were leaving Colorado Springs now they call my office and complain about all the road construction they're upset about all the cranes and some even claim our cities being overrun by young people we have consistently been named as the most desirable place to live in the country and a big reason for that is our economic growth with a current population of about a half million people Colorado Springs has grown from the 42nd to 39th largest city in the country well our population growth has been steady our economic growth has been exponential the roast domestic product of Colorado Springs metropolitan area has grown by a third over the past eight years from 30 to 40 billion dollars annually our city's economy is now ranked among the top 10 municipal economies in the country driven by both job growth and wage growth we've created about 47,000 jobs since 2015 we're also among the top 10 cities in America where college graduates want to live the reality is you cannot create the 5500 jobs needed annually to accommodate our graduating children and grandchildren who want to live here without growing and the fact is all healthy cities grow I'm proud of the state of our economy and grateful to you for your investment and interest thank you for your dedication to Colorado Springs Olympic City USA our presenting partner is Bank of America please welcome mr. Jason Edelman director and market executive of Merrill Mountain Plains Bank of America all right well thank you first of all let me just thank the group the team that put this together the 26th annual UCCS economic forum it's really great to get over together I know last year wasn't wasn't as lucky but it's really good to have everybody together so my name is Jason Edelman I am a managing director with Merrill Lynch and Bank of America I'm part of the Colorado leadership team and on behalf of all of our associates in Colorado everybody we are proud to return to return as a proud sponsor of this economic forum this event is truly part of our continued commitment to make financial lives better by connecting our clients our employees and our communities to the resources that they really need and deserve to be really really successful our expertise and resources provide us with the opportunity to really play an important role in helping to build thriving economies around the world and then right here in Colorado Springs as well in fact when you look at you know Merrill Lynch's wealth management private bank Bank of America's consumer and commercial banking capabilities we can pretty much do everything under the sun and we incorporate that into the to the help that we provide the communities we are deeply involved through our work with powerhouse partners like UCCS and Pikes Peak Habitat for Humanity who are focused on building and strengthening our city and our communities this economic forum brings together visionary leaders which you're gonna see right and many of you in the room as well who have made a commitment to drive our economy forward you heard from the from the mayor as well so we're proud to be one of those leaders just one of those leaders in the community providing resources to advance the economy and social progress as well and we do this through a variety of different ways many different ways but a few examples one is the deployment of capital right so the deployment of capital to businesses entrepreneurs to get them going to help them another way is through our philanthropic efforts to foster racial and equity and economic mobility and then another example is really just through the power of our engaged employees with the who volunteer their expertise their time and helping the community overall so you know we heard a little bit about what's happening in Colorado Springs but Bank of America is also growing in the state in fact we just added two financial centers right here to Colorado Springs last week we just did a ribbon cutting and in the North Academy financial center so if you haven't seen our nice new modern financial center go check it out and in closing look you have our commitment you have our commitment to collaborate and support environmental economic and social progress you have our commitment and we look forward to demonstrating that commitment right here in Colorado Springs so thank you I really hope you enjoy the event thanks for the time good seeing everybody thank you mr. Edelman Bank of America and all our partners who helped make this day possible and now we have a woman who needs no introduction in our community dr. Tatiana Bailey director of the UCCS economic forum here to share the national state and local economic conditions and outlook Tatiana take it away thank you thank you well it really is nice to see everyone in person again but before I get started I have to say I want to introduce two very special people I think the second year I was here I wanted to start a fellowship for a couple of students UCCS you know access is an issue I'm a first-generation student focusing on first-generation students are just high-need students in general and we finally made it happen this past year so I'd like to introduce Amanda Ford one of our fellows who was awarded this for this academic year and also Diego Urtado come on up as well and they just want to say a quick word hi I'm Amanda Ford I'm a sophomore at UCCS and I'm double majoring in business international business and political science and I just want to thank the sponsors of the economic forum for giving me this opportunity and letting me focus on academics and professional development this year hello everyone my name is Diego Urtado I'm a freshman at UCCS I'm studying accounting and I just want to thank everyone who donated all the organizations and people who donated without this this wouldn't be possible thank you so much God bless America okay that makes me really happy so I also have a lot I'm gonna be saying but I also want to thank my few girlfriends who sent me a text to say hey I like your dress because any of you women who have daughters you know I showed this to my two daughters who are here and they were like oh interesting pan-am flight attendants circa 1960 wow too late to change now so anyway they always keep you grounded right those kids okay so always always start with gratitude that's what I tell my kids to forum founders two people who are very special in my life in particular Tom's Warline and Ron Chernak both retired now a huge thank you to them just had them at my house the other night because Ron Chernak is also transitioning out into retirement of course all the community sponsors the partners of the UCCS economic forum I think when we started Tom you know Tom was a full-time professor had a handful of sponsors and now we have about 60 I've always been overwhelmed by the level of support and positivity in this community so a sincere thank you to all of you and a huge thank you to Rebecca I know she's out there but I have to say it the University of Colorado system everyone including my colleagues at CU's lead school of business and what they do in the resources that they provide the state of Colorado government offices I couldn't believe when I first got here how all of these people in Denver made themselves available to me to help me understand the state and local economy the governor's office you'll hear a little clip from him at the end I'm on one of I was appointed by him to be one of his nerdy economists and they to provide a wealth of information for me every month in those meetings and then the media I find that the local media here reaches out and they have a true desire to bring out good information so as as was stated yes Rebecca and I are moving on to a new chapter it's a little daunting but very exciting Rebecca is a K-12 former K-12 teacher now when I was working part-time and homeschooling at the same time I worked for a nonprofit back in Michigan called Corporation for a Skilled Workforce always always had a lot of interest in workforce as a mom and as an economist really a lot of it has to do with jobs are at the center of everything that's how businesses function and that's how households thrive so that's really what I'm gonna be focusing on moving forward building more collaborations with community colleges I'm gonna talk a little bit more about that including Pikes Peak State College Community College of Aurora and now Pueblo Community College as well collaborating more with our local K-12 already have meetings set up with three school districts that I've worked with in the past but now I can go a little bit deeper with them they've actually reached out to talk about tweaking their continuing technical education or career technical education with some of the labor market information that Rebecca and I provide then we also wanted to scale what we do in some other communities over the past three four even five years I was amazed at how many big cities bigger than ours would reach out and say hey stumbled across some of your data online or what you're doing with workforce in your community with some other key players could we talk with you for a few minutes about how you're doing that so the ability to do that a little more is part of what we're also looking at so really this new nonprofit is gonna stay local but it's also going to be across the country not so much doing our own thing as much as supporting the good work of other people with data and then I'd like to just end with saying that I think we need all of the above mentality we need economists we need chambers enabling business growth we need good government county and city ensuring that we have infrastructure services you know that that really help households and businesses thrive I think we need all of these all of the above so that we can reap those synergies between these organizations and then of course here I have all the platinum level sponsors the gold the media partners went way ahead there and then the sustaining level partners thank you okay so I'm gonna jump right in now I'm gonna talk a little bit about are actually a lot about this overarching context this is sort of the framework that I want you to keep in mind as I'm talking about the economic data now if you talk to historians which I'm not and you say to them okay well what have been the major transitions that we've had as humans they would say probably six of them big ones like fire urbanization and so forth and usually like a millennia in between them are certainly several hundred years I sincerely believe and I wrote an article about this a few weeks ago that we have three transitioning transitions happening at the same time right now and we have almost 8 billion people on the planet food that's due to a still increasing population on the planet but we all know that climate impacts our ability to produce sufficient food and at attainable costs that's the first one the second one energy due to the move towards alternative green energy sources but we haven't really paid enough attention on how to do that sustainably perfect examples what's happening in Germany with natural gas and so forth very good intentions very necessary but those bridge sources haven't been very well coordinated between countries the third one demographic due to stagnant or decline declining population in developed countries causing labor shortages we all know about that right alongside increasing population in some of the poorest regions of the of the globe now those are three really big transitions so why isn't economist talking about this because these impact both short term and long-term sustainable growth now are we in a recession that's the big question right now right well we all know that we have labor shortages too few workers and a low labor participation rate there you have it the demographics I'm going to talk a lot about that short-term and long-term problem this is due this demographic transition due to aging lower birth rates lower immigration talk more about that in a minute the skills gap consumer and business confidence is also not so hot right the high food and energy prices again both a short and a long-term problem causing record inflation that we haven't seen in 40 some years supply shortages and disruptions which is causing the Fed with this high inflation to have to raise interest rates but will this restrictive monetary policy do the job because typically interest rates go up in order to kill or at least quell demand but most of these problems are supply issues right so it's questionable how much impact these interest rate increases are going to have or what pain we're really going to have to withstand and then I'm going to talk a little bit about residential and commercial real estate and then some final thoughts okay so are we in a recession all right q1 of this year we did have negative GDP growth which is really a contraction of 1.5 percent so negative 1.5 percent then we had q2 at negative 0.6 percent so almost flat but still technically two consecutive quarters of GDP contraction usually that does mean a recession now the Federal Reserve of Atlanta does this GDP now where they're tracking it sort of in real time as the data points come in so far that's showing positive growth for the third quarter okay we won't know yet for for a little while and then really it's this group of eight economists only eight economists imagine that National Bureau of Economic Research that makes the final call whether it we're in a recession or not the march april of 2020 contraction that we had was actually called a recession even though it didn't last for two consecutive quarters now i'm thinking that in these transitions that i'm talking about with these structural headwinds i think big problems call for big solutions especially when you have eight billion people on the planet i think it's going to be really important to first of all think longer term so that the problems that we have now we can address them okay we can define the solutions as opposed to these problems defining us okay in our future trajectory we're going to have to innovate our way to the other side a lot of times the hardest challenges humans have had we we've been able to use innovation in order to help us get to the other side and then make sure you always seek out real data okay look at it objectively and build solutions with a data driven mindset you know some of you have heard me say in terms of data i when my kids were young i put you know the top job openings and the projected occupations growing the most on the fridge my kids are a bit older now so now i say hey don't just look at your phones not just snippets of information mom's on fox 21 once a week you can watch her watch her segments she uses government source data so i actually make them sit down and watch it but it doesn't always go as planned so i try right okay back to the big and bold solutions all right so if we talk about energy and food those two transitions they're highly correlated interrelated food is transported right for the most part so energy high energy costs mean higher inflation reducing climate disasters increases food production instability for sure if we focus on clean energy which by the way employs three times the workers that fossil fuel extraction does now with four million workers in the us it's rapidly growing that's a positive externality in terms of job creation that median hourly wage for these types of jobs is 25 percent higher than us median wages and this isn't from a hugatry.com this is actually a source that that i rely on quite a bit 52 of the world's new vehicle sales will be all electric by 2030 i checked that source all over and it's pretty consistent so what if the government provided incentives to pivot more quickly and some of that is in the inflation reduction act what does this do it reduces emissions mitigates the volatile world supply of petroleum it creates jobs and it reduces inflation how about if we also use fiscal stimulus to lead in this global energy transition and also train people for these jobs and then what about for the demographic transition well one thing i'm definitely going to be working on study and raise public awareness on the top growing occupations there just isn't enough information about that in schools but then also in in general in communities provides subsidized training free training is great especially for certain income levels or below but sometimes you even have to subsidize training kind of like what is done with loans for doctors hey well we'll pay for your education if you work afterwards for this many years or months it's a great use of tax dollars since workers become taxpayers we reduce welfare programs and increase global competitiveness provide incentives to higher ed to audit labor demand to the programs they offer with more emphasis on these high demand certifications and skills and then a big one we need to reform immigration now this is the one that i feel like we can impact more at the local level which is part of why i'm doing what i'm doing moving forward okay what about the current state of the labor market well very low unemployment rate still not seasonally adjusted 3.8 percent the july jobs report over half a million new jobs 528,000 doesn't seem like a recession does it remember though that the unemployment rate is low because it doesn't count all the people who haven't been looking for the last four weeks so if you add it all up the unemployed 5.7 million people 5.9 not actively in the labor force but say they want a job they just haven't looked in the last four weeks you add that all up the marginally attached part-time who want full-time it's 11.1 million people that's a lot of un or underutilized labor labor participation rate that red line over there never really recovered after the great recession some of this is is more complex with aging that i'll talk more about in a minute but in general we can say the u.s has half a worker for every open position most of the unemployed are young see think oh well that explains a lot but remember the one young ones are the ones who are most actively looking for work okay remember you don't get counted in the unemployment rate unless you're actively looking for work now how does this compare to other nations i always like to look at this because if you look in the upper right hand corner and you compare us to Canada Germany UK and Australia look at us in that teal line our labor participation rate for those prime working ages is lower so there's a lot going on here and even before the pandemic look at what the Bureau of Labor Statistics says in terms of labor participation by 2030 it's either flat or declining so things are not going to necessarily be getting any better same thing for El Paso County declining labor participation rate and we are younger look at the box in the upper right hand corner our median age is about 35 Colorado is 37 and a half us 39 so i feel like we should be going in the opposite direction here so there's a lot of work to be done so why do we have a shortage of bodies well we need to remember Betty Betty White what a queen right um need to remember that the labor participation rate calculates all people ages 16 and up i've made my phone calls to the Bureau of Labor Statistics i don't think that's the way they should count it we should only count working age people because remember this means that we include senior citizens right now the us has one in seven citizens who are 65 plus and by 2030 it's going to be one in five so the main reason our labor participation rate is falling is because of the aging of our population that is definitely true and a lot of the boomers who maybe stuck around till they were 70 72 they're just simply getting too old to work now and don't want to work anymore so if we look at true working age people ages 16 to 64 the labor participation rate for that group is the same now as it was before the pandemic so it's not the young and the restless or the young and the lazy okay and that participation rate is 76.3 and then we all know that women exited the labor force quite a lot during the pandemic it's gotten a bit better but look at what the difference between 2019 and 2030 child care is clearly an issue this is another thing that needs big and bold solutions it pays for itself rebecca and i did a study with the legacy institute a few years ago that showed the return on investment for just a force program for low and middle income families is 19 in a given year if you look at the long term benefits for the kids in terms of better learning and better outcomes it's actually a 30 percent ROI that's pretty high and then we can't forget that we have fewer children now than we did 10 years ago people stopped having really big families many years ago and now it's sort of coming to roost we also need to talk a little bit more about legal in immigration i mean if we simply don't have enough bodies we're going to have to look to other parts of the globe speaking of that look at that line for africa that's the only one that's really significantly increasing as i stated earlier poorer regions look at europe the magenta line by 2050 i think it is the un projects that there's going to be an even further decline by 20 percent in the european population latin america is growing modestly and they are probably our closest geographically so that's another reason i think to look at avenues to make them legal citizens and of course the shortages are made worse by all of the quits that we have there at all time highs now you can see in the upper right it is leveling off but it's still record high levels and this doesn't usually happen during recessions or recoveries now this is actually a good thing another thing that is impacting the shortage of workers is that we have more self-employed people that does usually happen during recessions because when people lose their jobs they're more motivated to maybe start the business that they wanted to start and remember this is a million more people who are saying they're self-employed compared to 2016 and those are the ones who are reporting that they're self-employed now what about our demographics well you can see we're the green bars and we've always outpaced the us in terms of population growth rates but look at how much it's been falling in the last few years and it's for all the reasons i just talked about same thing for el paso county okay we are still projected to be at almost a million people by 2050 but you know definitely a declining rate of population growth most of our migration is in migration and then you can see over here you know denver and el paso county not the msa is not the full cities but the the two counties have always kind of gone back and forth on who's bigger but it's pretty decidedly el paso county now as you can see in the bottom rate and then if you look at the entirety of the united states you can see that the the purple areas are the ones with growing populations gray is kind of modestly growing that's where we are and then the orange ones are the ones with population decline mostly the industrial belt and then you know if we look at our growth and we do it by age look at the two bottom lines red and green 18 to 29 that's still increasing that is a huge comparative advantage and then look at the us those same two cohorts completely flat so we do have increase in young cohorts now workers potential workers look at the 30 to 49 the top bar for us also growing so this is a huge competitive advantage for us but only if we train workers for the jobs of today and then another important thing look at how what a large percentage of our population is going to be people of color by 2050 so we need to make sure that these cohorts have accessibility to really strong good k12 and post-secondary education because they are our future workforce as well skills gap that's another major barrier we need every worker we can get so let's make sure we train them with relevant skills so job openings aren't the problem 11.2 million look at how that's off the charts on the upper right and yes it's stabilized but it's still at record levels many of the non-participants bureau of labor statistics does surveys say hey I stopped looking for work because I don't have the skill set that employers are asking for it's a huge argument to be made for reskilling and upskilling people and I commend actually pikespeak workforce center as they focus a lot on that and remember about half a worker for each available job we have openings across a lot of industries this is not a problem just for instance for leisure and hospitality we have government education and health care professional business services financial trade and transportation manufacturing it's it's all across the board pretty much and then look at the job openings in april of 2019 about seven million versus 11.2 million in 2022 just this past month up 55.6 percent and then what about locally how can we figure out what our skills gap is well first of all we have about the same shortage of workers about half a worker for each open job colorado is even tighter that's mostly the denver boulder area and the ski communities by the way at 0.4 available workers per job these are top 10 job openings i typically look at the top 30 or 40 but here are the top 10 the letters are the risk of automation something we really need to pay attention to as well and you can see the number of postings and the market salary this is really good important information that people should have especially kids and a total of about 27 000 job openings in the month of july and that's local so back to the big and bold solutions closely examine the labor market in your region that's number one look at the top occupations the number of openings by occupation the market salaries the most demanded skills and certifications and then juxtapose those to those employer needs to the training programs that you have in your community do they match or don't they do they match well do we have the right programs are they at scale at the scale that we need them to be for the hundreds or thousands of openings we have that's how you actively build a pipeline of qualified workers most of the highly demanded occupations and skills do have livable wages i look at that data every month and remember that relevant training and good wages is also how you pull some of those workers back into labor participation so i looked at this this is the july data for our region these are the top demanded certifications yes things like driver's license you need to to drive in most but also security clearance a lot of it jobs like cyber certifications network administrators truck drivers certified nursing assistants med technicians phlebotomists and so forth all of those are really high demand right and then what about programming and software related skills well look at the top ones those it's just that's just the microsoft suite command again pikespeak workforce center we looked at this data together at the beginning of the pandemic and tracy marquez said well let me let me see if i can get an online training program for the microsoft suite that people can do at home what a great idea right and then of course you have other ones that are mostly certifications linux java sql c++ and so forth it's a little touchy now in juxtaposing these top occupations you can literally list them out and then in a handy excel spreadsheet say hey are those programs even offered locally right here i have the ones that are offered by pikespeak state college yes or no that's a start right and you know as an example rebecca and i did in 2017 an audit of some health care positions look at medical assistance we had 1063 openings in 2017 and we trained 214 people so a delta of about 850 that's a missed opportunity now this is actually i think a really cool program that just passed this past week it's called care forward colorado state of colorado is going to be investing 26 million from covet relief funds guaranteeing free schooling for certain high demand health care occupations cna's emergency medical technicians pharmacy techs phlebotomy techs medical and dental assistance the program is effective for two years we have funding for two years it reached it got bipartisan support right who would argue with this it's going to reach about 4 000 students now by 2026 colorado is going to need 54 000 entry-level health care positions so you could say oh my gosh is this going to make a dent um hey it's a start right and remember that a lot of these uh technical training programs have career pathways in fact uc health does something really cool with their um uh incumbent work or training and opportunities and uh we're going to hear from that um from ron fitch on that so right now i just like to show another example and testimony of some data-driven decision-making by dr brownley take it away the demand of today's world requires higher education to move faster and more efficiently than ever before to take such action it requires an institution that is deeply committed to responding to the needs of industry and its community in the midst of constant innovation and disruption the community college of aurora understands our responsibility to serving our community as a vessel toward social and economic mobility to the nearly 11 000 students we serve and we also understand our effectiveness in this work requires a systematic redesign of our current student experience in partnership with the uccs economic form cca has gained access to critical economic forecast and industry data to reevaluate our course offerings and academic pathways it was this critical information that provided the insight we needed to identify 27 programs for closure and place another 49 programs on a developmental improvement plan towards sustainability why because what good is an institution that awards credentials that don't lead to high wage high demand positions designed to meet the needs of our growing and evolving economy the future of our american workforce depends on higher education's ability to realize that now is the time for systematic change i am dr morty car brownley proud president of the community college of aurora pretty impressive right i did a presentation for the community college presidents in the state in pueblo and dr brownley came came up to me and said hey can i talk to you some more and i pulled some of that data for him and i really commend 27 programs that he said were kind of tenuous to begin with that the data helps support that those needed to be closed and he needed to ramp some other ones okay back to big and bold solutions i think another huge opportunity yes free community college are subsidized for pell grant recipients by the way the data shows it's not really very helpful unless you target it to the people who need it the most and i tend to agree with that let's also utilize fully utilize public universities which often give the higher level training at a much better cost as opposed to the private ones and then i think a big one too look at how many veterans we have in el paso county 84 000 as as ron knows i call these low-hanging fruit i mean there's a there are a lot of great communities or a lot of organizations that that are already doing wonderful work in this in terms of transitioning these but again let's use the data to fully employ those those opportunities okay so i don't think anyone argues workforce development is a golden opportunity especially if it offers livable wages you get all political affiliations behind it what if we could choose to provide the paid training for the highest demand occupations as it raises labor participation raises the tax base and home ownership all while boosting business growth and global competitiveness some of the positive ripple effects that i know that this would bring is decreasing poverty levels decreasing transfer payments welfare payments substance abuse and crime rates the highest crime rates are in your highest areas of unemployment all while providing more opportunities for at-risk communities and chipping away a generational poverty okay what about state and local labor markets including wages well this is the same unemployment graph but now you can see pueblo el paso and colorado um our region in the state is very low remember that economists uh say four to four and a half percent is the natural rate of unemployment uh and we are well below that pueblos a bit higher at five point four percent this is how we compare pretty much all the msa's in our region are somewhere in that three and a half range except for pueblo these are our employments by sector you can see pretty uh pretty diverse if you will for colorado health care retail professional and technical accommodation and food construction and so forth i think one of the things that's really interesting is when the pandemic hit people said oh states like colorado are gonna get hit especially hard because of the hospitality uh dependence if you will but look at we are so diverse with a lot of professional and technical and finance jobs and so forth we did just fine also we have outdoor sports so that that certainly helped and then you can say pretty much the same thing about el paso county we're a little more reliant on health care uh and social assistance but still good representation in terms of employment across many sectors and then if you look at the projections uh from the colorado department of labor these are the sectors the ones that have been growing a lot that are projected to continue to grow look at with transportation and warehousing amazon prime uh seven percent increase there 67 percent additional employees projected um by 2030 for us and then i also like to pull this data to look at what are the new businesses being formed here by sector look at the one with the biggest growth professional and technical and this is uh comparing 2006 to 2021 now this is the you know kind of the bad news our wages are still lagging wages are horribly sticky we have a long legacy of being at a lower average wage than both the us and colorado it's kind of hoping that the pandemic numbers as they started to come in would start to close that chasm doesn't really look like it el paso county wages are about 14 percent lower than the us and about 18 percent lower than the state of colorado which is mostly uh denver bolder that's a problem now it's a whole other presentation and i do have theories behind this um so it's some of it is explainable but a lot of it is also problematic especially as i get to in a few minutes the real estate section you can't have lower wages uh than the us and have higher median prices than the us in terms of housing and then um the one good thing is we do have a lower proportion of our population at 9 percent at or below the federal poverty level compared to the us at 12 percent but i'd also like to show you this you know livable wage that mit does for instance let's look at a household with two adults one of them working and two children that one adult needs to make $80,000 a year in order to just meet necessities sorry about this um okay and then that tied to that i think we also have to pay attention to wealth inequality i did a paper in early uh early 2020 that looked at wealth inequality income inequality three different ways i personally think that the best one is not income but wealth and that's because it incorporates assets right like does somebody own a home or a car or whatever the federal reserve tracks this data the top one percent of the united states uh that top shelf there uh the dark green had 32 percent of the wealth in the united states and the bottom 50 percent had 2.4 percent of the wealth that's that little skinny uh red line at the very bottom i don't think you can find an economist that thinks that that's sustainable um so i think that's also something structural that we need to pay attention to and i do think that it's also a lot of the reason that we have the polarization that we do there is a professor named Scott Galloway who i listened to pretty routinely from uh nyu stern school of business need he cited a study that said 60 percent of americans think that the opposing political party people in the opposing political party is the quote enemy the word enemy and i liked what he said he was astounded by that and he said our greatest ally will always be other americans so let's also talk a little bit about post-secondary education costs in the u.s because this is also exacerbating our labor shortages we are at 43 percent of our population in colorado having at least a bachelor's degree second most uh educated compared to the u.s at 32 percent but we're also one of the worst states in terms of the proportion of tuition that students have to pay at public institutions so there's a bit of a mismatch there right and remember we also have a lot of in migrants so a lot of the people who live here got educated somewhere else also enrollments are down compared to 2021 to 2020 for instance in colorado enrollments are down 5 percent now some of this is the demographics that i talked about but there's also a bit of a shift going on in terms of what type of education do you need in order to get a sustainable job and a livable wage job student loans we all know are a problem student debt now amounts to 1.75 trillion with 43 million borrowers that's more than credit card debt federal average student loan is about 37 000 and 55 000 for black borrowers 20 years after entering school half of the borrowers still owe 20 000 i think about home ownership right and wealth accumulation there and it's ubiquitous today 70 percent of college grads have student loans okay so this permeates right all throughout the economy and completion is still a problem on a weighted average basis for the different types of institutions about half of university level students who enroll do not graduate by the end of their sixth year and at that point it's pretty unlikely that they're going to so how much of this is attributable to costs that i just talked about probably academic readiness probably and income inequality probably all of the above back to the big and bold solutions Pell Grant recipients i think actually should have access to more free training and that can be higher ed it can be certification because this is also going to help address the wealth gap that's good training and good jobs that's how you break that generational poverty okay so what about some other important metrics all right so savings rates it's interesting i don't think this is talked about enough they're now at about five percent and they were at about eight percent before the pandemic i don't think we're looking at that quite closely enough delinquency rates on credit cards are going up a little bit but not too bad right nothing like the great recession but we are starting to see a little bit more reliance on credit card and remember the interest rates on those credit cards are going up now eight point five percent inflation was the latest read in july down from i think it was nine point one percent but remember always look at baseline effects that eight point five percent is from a year ago 12 months ago but prices started to increase at four percent or more in april of 2021 so any of the increases we're now seeing are on top of the increases 13 14 15 months ago so keep that in mind also the cost of living index for colorado springs is now at one 104.1 percent meaning we're about 4.1 percent more expensive than the average us city is lower than 100 by the way when i got here now part of the problem with inflation is how broad-based it is right look it it's it's across many goods and necessities and and big components of household budget food gas electricity shelter which by the way is going to keep feeding these inflation numbers because that metric lags significantly and cars and trucks and then of course the big problem is that even with the wage increases we've seen if inflation is this high real wages are down three percent that's a big problem so this puts the fed between a rock in a hard place absolutely have having to raise interest rates but as i said a lot of our problems are supply side issues and this is attacking it more from the demand side and then i'll give you a peek in the forecast i'm actually thinking the fed funds rate is going to have to go to four percent with inflation being what it is which is a little bit higher than what a lot of other economists say and now what about the consumer confidence i talked about well i was really surprised to see university of michigan first game by the way on saturday against csu anyway here you can see that consumer confidence is lower than it was during the great recession but that can't be right but then if you read the detail it's all about inflation that's why it's as low as it is good time to buy clearly not that's kind of fallen off a cliff right unbelievable and then those people have said to me wait a second retail sales are good though come on things aren't so bad it's in dollars you see that jump over there on the upper right hand that was april literally that was april 2021 when prices really started to increase because this is this is incorporating dollars now yes some of this was uh you know people buying more things especially when they were at home and it's leveled off but you know it is highly skewed by inflation s and p 500 i mean this is really crazy uh thanks to brian lane i got some help from merrill lynch in terms of looking at this sort of the right way because there are many ways to look at it i think this 12 month moving average is the best going back to 2015 you can see look all right different percentage increases in the s and p 500 but look at 2021 31.2 percent increase uh that's overvalued right so no big surprise that year to date we're only at 1.3 percent there's a lot of correction okay and then i also like to look at local consumer confidence um i i can't do it all by myself so i just rely on new vehicle regent registrations things like that pretty steady for the last many years luxury up 67 percent over the last uh three years uh so that tells me people who have money are spending it right and then if i look at sales and use tax that's also been up but it's also measured in dollars but at least it never had fell off a cliff like we thought it might during the pandemic and then business confidence here you can see that's also not so good over there on the right hand side and if you look at the surveys you can see that um 37 percent say inflation is their number one problem no great surprise the highest level since 1979 20 percent of businesses plan to create new jobs ah what's going to happen with the labor market i don't think that's going off a cliff either 48 percent of respondents say they have increased compensation wage inflation there you go right wage price spiral about 50 percent of owners say they couldn't fill job openings and 91 percent of them said they had few or no qualified applicants all right now i'm going to transition into housing real estate makes up about 12 to 15 percent of GDP if you include all those components and then i pay a lot of attention to this because it's a usually the biggest uh amount that a household has to spend every month but also it's the primary mechanism for wealth accumulation here this is us existing single family home prices you can see that you know during the pandemic almost became logarithmic in july is still high at 411 000 double digit high double digit increases um a year ago and for most of this past year now moderating but still increasing home sales have definitely cooled because of the higher uh higher interest rates that's not a huge huge surprise and this is for new homes and then permits are now down about 12 compared to a year ago and the national association of home builders in their survey they are not as optimistic they are uh quite cautious now home ownership rates um we get spotty data from el paso county but you can see that in the early 2000s we were closer to 70 and we're now about 65 percent here you can see all but one of the 185 msa's cities that were tracked by national association realtor showed gains in single family homes in the past quarter 80 still had double digit growth now it is cooling but it's not again falling off a cliff 100 percent of condo homes increased and then you can see median prices over the past year up 14 percent condo 12 12 almost 13 percent and then national association of realtors is actually saying for this year home prices are gonna overall over the course of the whole year have about an 11 and a half percent increase in prices still with the amounts there and almost nine percent for new homes but then pretty flat for next year okay i'll get it right there we go delinquency rates um i keep an eye on this as well and they went up a little bit after the pandemic but uh they have stayed pretty pretty manageable thus far existing home sales have actually decreased for six straight months year over year sales have decreased 20 percent okay so again cooled but a year ago is really hot 32 percent overall price growth in the past two years 32 percent on average in the us now this moody analytics did this and i found this fascinating i don't know how they do this but a lot of people pay attention to it housing market is 24.7 percent overvalued slightly higher than what it was during the great recession that's alarming 84 percent of the us markets are considered overvalued and some are much worse like Boise look at that 72 percent overvalued and i'll i believe it because i'll show you some data in a second and then moody's is actually expecting a depreciation of five to ten percent in the next year and then a couple of slides on colorado real estate we are unfortunately still one of the most expensive states uh in the united states in terms of home prices and then this is from a lead school of business um you can see here that the dotted line shows you the number of permits issued for single and multifamily match 2002 all of that delta we underbuilt and this is also true across the united states we have a shortage according to the experts of 6.5 million homes in the united states and this is part of the reason i also think that housing is not going to fall off of a cliff if you have that much of a shortfall there's still going to be some demand out there and then in terms of apartments we are ranked the eighth highest state in terms of apartment rentals you need about 30 dollars an hour to rent an average two bedroom apartment in our in our state and at the minimum our minimum wage that would mean 75 hours a week of work and then local real estate in 2006 our local median home price was eight percent below the us and at the end of 2021 it's worse now we're 22 percent above the us and remember what i was showing you about wages being 14 percent below uh colorado that's a definitely a problem okay and then over here you can see for new and existing in our region look at our average home price in july and look at our increase it's been a lot more precipitous and now we're almost at a logarithmic level and this is a lot of the reason that i think things are going to moderate for us and up there you can see the average and median home price average being about 560 000 average days on market is 14 that's still pretty quick turnaround for homes and then this i did for uh one of the uh media segments i do look at from july of 2019 to july of 2022 our average home price has increased 49.6 percent unbelievable all right and then here if i had to guess and i have called a lot of my colleagues in the real estate industry this is where i think prices are going to end up on average for 2022 and those are in the boxes in the upper right hand corner there and i will tell you too that the median home price in our region is moderating it's even seen some declines over the last a couple of months modest declines much more than average home price why because the people who have money are buying the really big uh the really big and expensive homes and then here's the forecast in the actual dollars up for us in 2022 10 for the median and up 9.7 percent for the median home price and then for closures i got a little nervous up there in the on the right hand side but they seem to have come back to uh to a level that is pretty much what it was pre-pandemic hopefully it'll stay that way and then this is just showing our appreciation compared to some other msa's across the united states and i i found this kind of hard to believe i mean look what about four Collins how did four Collins become so expensive and then look at boulder 933 thousand for the median home price in q2 and then i also want to show you that most of this the home sales in the united states are between that 100 and 500 thousand range and we are at between 300 and 800 thousand okay so that's definitely pulling up our average as well and then that same graph that i showed you for colorado this is it for our region and i've calculated us has a shortfall of 6.5 million homes ours is about 12 000 same type of methodology that i used and then this one i actually have an article coming out a week from sunday this is called the housing opportunity index and that shows the percentage of median price homes that are affordable to the median home median income home okay so basically what people can afford look at where we are 23 percent as recently as q3 of 2019 we were at 71.4 percent we pulled these numbers like three times because we couldn't believe how how much lower all of these cities got unbelievable so we'll see if we're going to have the type of correction that some are saying so we're going to continue to have upward pressure on interest rates slowing in migration stock market volatility all of these things are going to moderate home prices right number of listings should continue to increase that's going to help moderate prices so instead of having like 20 appreciation we're probably going to be down closer to the 10 percent that's the recap and then just a couple of slides on apartment you can see that the lease rates are still going up in our region quite a lot but vacancies are still really low so that tells me that you know prices are probably about you know people are still demanding it housing and urban development is still calling us a slightly tight market so that kind of validates what what i'm seeing and hearing from my colleagues in apartment and then what is the fair amount that could that should be paid according to the low-income housing coalition if we took a 40 percent so just kind of a very average apartment in colorado springs at 1300 you would an average person would need to make about 25 dollars an hour 52,000 a year but the average renter in our region makes about 19 dollars an hour and this is where i worry about the workers who want to come here and stay here but can't afford to live here and of course it's much worse than for instance the mountain communities and then you can see here we are still cheaper than Denver and the U.S. at 1700 per month but not by much and those vacancy rates are still very low and of course as interest rates go up and more people can't afford to buy a home they're gonna have to rent right so that keeps demand up as well brief comments on commercial real estate the record low construction that we had in 2021 in retail multifamily and office actually helped it kind of kept the market stable if you will industrial the star hands down of the past two years super high demand and lots of construction office vacancy rates in the u.s. right now are at 18.4 percent okay a little bit higher than last year but that's not as true locally because we didn't have a lot of excess product to begin with okay our our vacancy rate is 9.4 percent the physical occupancy in the u.s. is 40 percent i i found that really hard to believe so if you walk into the average office building right now it's only about 40 full so there's a lot of uncertainty and a lot not a lot of investment that's going on negative absorption of 8.4 percent mckinsey did a large study looking with 25 000 people in the spring and it showed that 58 percent of americans have at least one day a week that they're working from home 35 percent that are fully remote and the third most common reason for quitting is because of no remote options so i'm not an expert on this but a lot of experts who are say work from home to some degree is here to stay and that of course impacts the office category here multifamily you know off the charts record growth never seen it in the you know 40 years they've been tracking it 17 growth in effective rents vacancy rate of 4.5 percent across the u.s and still high absorption retail everyone thought it was going to fall off the cliff during the great recession but it was already adjusting so rents and vacancy rates are actually still pretty flat e-commerce is now about 15 percent of all commerce so that's certainly impacting that and then the vacancy rate is at 10.3 percent nationwide for smaller retail and 11 percent for malls industrial super low vacancy rate of 5 percent effective rents are still going up and asking rents still up 12 percent year over year and then this is what our local market looks like and you can see our vacancy rates are pretty consistently lower than the u.s and then lastly um growth forecasts better known as guessonomics i always like to talk to young people um you know i have five kids so i talk to them a lot and i said you know what do you guys think are we in a recession you know what's going to be happening and this is what i got look at the guy in the middle there right all right so uh it's a little bold to make any forecasts right now but i'm actually sticking pretty close to what the conference board says they are saying that we're going to end up this year at a very modest growth rate of 1.3 percent and next year pretty flat 0.2 percent um you know and i think it's something like 60 percent of economists are saying we're going to hit a recession next year if we're not technically in one now and then here you can see they are saying that we're going to have stag inflation which is basically inflation alongside little to no GDP growth and that's because of inflation in higher interest rates supply chain issues mostly in china Ukrainian crisis affecting commodity prices a certain recession in europe uh with probably 18 to 20 percent inflation rates now the inflation reduction act here should help a little bit 400 billion dollars but we're not going to see the benefit of that until probably late 2023 or 2024 that's just how these things work as they roll out um the actually it's Wells Fargo who's saying inflation for this year is going to end up at 8 percent and about three and a half percent for next year uh consumer spending is going to only increase two percent and then be flat okay basically moving forward residential investment down this year five and a half percent and down another 4.7 percent next next year that should actually be 2023 unemployment rate holding steady around 3.6 percent this year and 3.7 percent next year and i agree with that for all the workforce reasons i already talked about and then something i think it's not being talked about enough i think we're still gonna have a lot of volatility and imports and exports because of the strong dollar so that's another monkey wrench uh that's out there and then this is the same graph but with the state and local growth rates you can see there um i'm actually forecasting the gross state product for 2022 to be a little bit higher than the us it's typically how it's been for Colorado at 1.5 percent and i'm pretty bullish on Colorado Springs at 1.6 percent and that's how quickly we rebounded in jobs and so forth during the great recession and basically all the momentum we have going here and then yes constrained growth next year but still at higher rates than the us unemployment rates as i said holding steady again a little bit lower than the us uh for Colorado and El Paso county and then i'll just uh kind of end by saying i really am overall bullish for Colorado and Colorado Springs it's not as much population growth but it's still growing still young and educated people we've become more of a destination for knowledge workers with remote work diversity of sectors a lot of innovation still very robust tourism a lot of growth in professional and technical including department of defense finance insurance health care and then we do have higher labor participation here than the rest of the United States and we still have a lot of nice growth in downtown and then here you can see some metrics on tourism look at how we're beating out Denver right here look hotel occupancy we just have become more and more of a destination look at inplanements and so forth and then i'm going to end with gratitude as well i think one person i really want to thank is my husband when we moved here um eight years ago i had been working part-time homeschooling for several years and my husband really stepped up you know he saw me busy and so forth and you know he's picked up the the cooking and all kinds of things around the house so i thank him he does wear goggles with onions and then in two days on saturday uh we're going to be married for 34 years i did have to get a note from my parents to get married on that day in september of 1988 and and and then that's us just uh like two weeks ago uh at a canadian wedding um my husband's canadian so um thanks to my husband for putting up with me and for um you know enabling me to do all the things that i like to do including the the next chapter um it's been a very productive uh marriage as you can see um these are our kids at a gen distillery um so thanks to them as well i think i have three of them here tonight so thanks again and um that's the end of my presentation thank you tatiana incredible information and congratulations on 34 years now please help me welcome kimberley sure kimberley will guide a short conversation with tatiana and we'll be back to moderate our panel following a short break kimberley david would you mind uh reminding people of the instructions for posing questions it's on the back of your ticket i think right the back of your agenda back of the agenda has meeting pulse where you can submit some questions and i think because we started late we'll probably uh keep q and a a little bit on the shorter side but i am available for a couple of questions so uh we want to do it with technology so bear with me i have i am a lot i'd how about somebody up front asks me a question i can hear you don't be shy yes wow energy price is two years out well everything that i see and hear and read um says that you know we're going to continue to have the volatility which is part of the reason that i uh really like to emphasize moving away from that volatility and that dependence yes we do produce energy here in the united states but we know that that it has issues uh and again we haven't built bridge energy sources the way that we need to so i think that volatility is going to continue but what the experts also say ron is that um the overall longer term trend it is not a renewable uh resource and that that you know that specific commodity is going to continue to increase it's going to go like this a lot but the trend line is still going to be upward um you know i don't i don't really see any any way around it now the interesting thing if we're really going to have 50 percent of uh all vehicles by 2030 being uh electric globally that's going to pivot everything very very quickly and that's i think where we're finally going to start to see some transition now petroleum products are in just about everything including trek decks i mean all of that so it's not going away um but i think once we hit that pivot point is really where you're going to start to see um stabilization and even decline in in uh petroleum products yes yeah we're going to be talking more about that in the panel uh and you know and we have certainly some experts you know i i think a lot about education right because um the private sector you know they know what they need you ask a business and they say i need this this and this the issue is that other people don't know right the would-be workers don't necessarily know the kids who are coming out of high school don't necessarily know so a lot of it is education that's that's on this on the supply side employers increasingly are saying i'm going to do this myself i'm going to partner with a community college or a technical school and even here i know that for instance pike speak state college even offers training at the work site in order to help with the uh the skills building uh that these uh that these businesses are asking for so incumbent worker training and when businesses can afford it not all small businesses can but when they can to really provide that as a benefit because they're going to benefit longer term as well so tatiana one of the questions this is a very localized question is uh what should be done about taber and should that be should we get rid of it wow it just came up on the list i'm just gonna say it okay um i think we need to get rid of taber i know um no no tomatoes or eggs please well and i think that that's great and you know that some people say that's politically motivated and so forth part of the reason is you know we are a growing state that's the issue you know i mean i lived in michigan for many years and that's declining um you know population there when you have the type of growth that we do you need infrastructure you need the maintenance you need new type of infrastructure you need to make sure that the schools are getting everything that they need and so forth and i'm not just and i'm not one of those people is it just throw money at it no you have to do it responsibly but a lot of these investments are investments that have a very positive roi down the road why because it makes things easier for businesses it makes things easier for commuting all of the different things um so i think for every dollar you put in that you know the opportunity cost of those taber dollars i think you're usually for the most part getting more than a dollar out and i think we need that in our state quite honestly well thank you this is the time at which we're ready for a break so it's 305