The Denver-Aurora-Centennial metro area has an overall grade of B- with a composite score ranking at the 46.0th percentile out of 50 US metros. This city's economic character is most defined by its low labor demand, with a composite score at the 30th percentile, and its tight unemployment market, with a rate of 3.70% ranking at the 82nd percentile. The combination of these metrics suggests a challenging environment for businesses looking to hire and expand.

Labor Demand

The employment growth rate in Denver-Aurora-Centennial is -0.44% year-over-year, and weekly hours are deviating 0.319% above the city's own 12-month baseline. This combination signals a contraction in labor demand, rather than genuine demand expansion, as hours are above trend during a period of job losses, indicating a survivor squeeze. This suggests that businesses may face challenges in finding and hiring new talent.

Unemployment

The unemployment rate in Denver-Aurora-Centennial is 3.70%, which ranks at the 82nd percentile, indicating a very tight market. This means that businesses trying to hire in this city will face significant competition for a limited pool of qualified candidates, leading to potential wage pressure. As a result, companies may need to offer higher salaries or benefits to attract and retain top talent.

Wage Growth

The year-over-year wage growth rate in Denver-Aurora-Centennial is +1.57%, which ranks at the 18th percentile, indicating stagnant wage growth. This slow wage growth means that employer labor costs are not rising rapidly, but it also suggests that worker purchasing power is not increasing significantly. As a result, businesses may not face significant pressure to increase wages, but they may also not see significant increases in consumer demand.

Cost of Living

Denver-Aurora-Centennial has a cost of living score ranking at the 53rd percentile, with a PSF of $293/sqft and average hourly earnings of $42.41/hr, resulting in a ratio of 6.91. This means that the city is near the median in terms of affordability, neither particularly expensive nor inexpensive compared to its peers. As a result, businesses may not need to offer significant wage premiums to attract talent, but they also may not have a significant advantage in terms of cost of living.

Labor Force Growth

The civilian labor force in Denver-Aurora-Centennial is contracting at a rate of -2.34% year-over-year, ranking at the 2nd percentile. This means that the supply of potential workers is shrinking, creating a structural headwind for hiring and business expansion. As a result, companies may face significant challenges in finding qualified candidates, and may need to consider alternative locations or strategies for talent acquisition.

Building Permits

The number of residential building permits in Denver-Aurora-Centennial is increasing at a rate of +12.87% year-over-year, ranking at the 68th percentile. This suggests that housing supply is expanding, which could improve affordability and accommodation for the workforce in the future. As a result, businesses may see a more stable and predictable housing market, which could support talent attraction and retention.

Days on Market

The median days on market for homes in Denver-Aurora-Centennial is currently 39 days, with a year-over-year increase of +8.3%, ranking at the 82nd percentile. This suggests a slower market, which could make it easier for relocating workers to find and purchase homes. As a result, businesses may see a more accessible and attractive housing market for their employees, which could support talent recruitment and retention.

Office Economy

Denver-Aurora-Centennial has a professional and office worker share ranking at the 66th percentile, indicating a deep talent pool in these sectors. This makes the city well-suited for businesses in the tech, finance, consulting, and HQ sectors, but less suited for industrial or logistics-dominant businesses. As a result, companies in these sectors may find a strong and supportive ecosystem in Denver-Aurora-Centennial.

The Denver-Aurora-Centennial metro area offers businesses a tight labor market with low unemployment, but also significant challenges in terms of labor demand and labor force growth. The single biggest risk or constraint for decision-makers is the shrinking labor force, which could limit the city's ability to support business expansion and growth. As a result, companies should carefully consider their talent acquisition and retention strategies when evaluating Denver-Aurora-Centennial as a potential location.