Colorado’s job market stalls as unemployment rate surpasses national average

Colorado’s rising unemployment rate shows no signs of slowing as it continues outpacing the national average. Meanwhile, updated data from February shows the state’s job growth is slower than previously thought.

In newly revised estimates for last month’s unemployment report, employers in Colorado reported losing 11,600 nonfarm payroll jobs and 12,000 private sector jobs during the month of February, leaving the state with negative job growth from February 2024 to February 2025 and an unemployment rate of 4.7%.

March employment reports from the Colorado Department of Labor and Employment show a better growth outlook with an increase of 6,800 nonfarm jobs and 5,800 private sector jobs — partially reflecting the return of workers from February’s King Soopers strikes. This pushes Colorado’s rate of job growth over the past year barely past February’s negative figures to 0.1%. The U.S. rate is notably higher at 1.2%.

The state’s March unemployment rate, however, still rose by one-tenth of a percentage point to 4.8%. March’s rate is the highest Colorado has seen since September 2021, and has continued creeping closer to the 5% cap that many economists typically consider full employment.

While the unemployment rate for Colorado has ranged between 4% and 4.8% over the past year, the U.S. rate has had a more consistent range of 3.9% to 4.2%.

Colorado’s unemployment rate has historically remained below the national rate. Economists have credited these most recent upticks to a mix of factors like mass federal layoffs, demographic shifts and the departure of seasonal employees.

As of April 18, Colorado has the 6th highest unemployment rate out of all 50 states and Washington D.C., with three other states matching its 4.8% rate according to data from the U.S. Bureau of Labor Statistics.

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Colorado’s labor force participation rate also dipped by 0.1% to 67.8% in March, marking the state’s lowest rate since October 2022 after it began following a slight downward trend in October 2024.