Sorting Through the QUE

Once each quarter, the University of Colorado Colorado Springs College of Business and Administration publishes a review of economic metrics in El Paso County Colorado.  (Available here)  Known as the Quarterly Updates and Estimates or QUE, it is a must read for anyone in public office or in business in Southern Colorado.   One can even subscribe to it free of charge and have it delivered each quarter to your email inbox.   Several items in the most recent publication merit comment.

The first one is the data set on housing starts in El Paso County.  Housing starts are up in El Paso County over the last year.  Good news.  However, the data set used by UCCS only details the last two years for a year-over-year comparison.  Curious, I visited the Pikes Peak Regional Building Department (PPRBD) for a longer term view.  The PPRBD data set goes back over a decade, and provides not only the total number of permits issued, but the total dollar value for those permits as well.  This enables a rough calculation of the average dollar value of the permit issued.  Using a crude inflation deflator, one can compare the average dollar value of a permit over time:

Year	Single Family Permits	Single Family Gross Value	Average Value per Permit	Average Value of Permit - Inflation Adjusted
2000	5,000	$608,339,213	$121,667.84	$164,036.79
2001	5,272	$635,301,017	$120,504.75	$157,973.49
2002	4,931	$594,876,052	$120,640.04	$155,689.36
2003	4,856	$625,138,761	$128,735.33	$162,434.60
2004	5,789	$803,787,146	$138,847.32	$170,649.16
2005	6,269	$904,596,195	$144,296.73	$171,535.05
2006	4,148	$696,796,063	$167,983.62	$193,452.80
2007	2,686	$478,817,710	$178,264.23	$199,606.90
2008	1,547	$301,121,873	$194,648.92	$209,894.25
2009	1,315	$416,491,672	$316,723.70	$342,749.62
2010	1,629	$505,995,855	$310,617.47	$330,716.95
2011	1,563	$528,358,733	$338,041.42	$348,902.25
2012	2,387	$836,160,686	$350,297.73	$354,221.90

From 2005 to 2009 the gross number of permits cratered, as El Paso County suffered along with the rest of the nation from the fallout of the interrelated housing and banking crises.  However, the average value of the permits issued skyrocketed both in absolute and inflation adjusted terms.  Indeed, in 2012 El Paso County had almost recovered all the way to the 2005 high in gross value of housing permits; but on only about 1/3 of the total permits.  Fewer permits mean fewer housing starts and, thus, fewer construction jobs, while the higher dollar value of those permits means that city and county sales tax revenue should be recovering quite nicely.  And it appears, based on the most recent City sales and use tax report, that they have.

The second interesting data set to be pulled from the QUE are the details on the unemployment rates.  At the end of 2007 there were about 290,000 jobs in El Paso County.  Today there are fewer than 270,000.  Factor in the growth in the population of about 60,000 to 70,000 people and we have a significantly worse employment situation than the official unemployment rate of 9.2 percent.

An improving real estate market is not solving the unemployment problem.

(I would like to acknowledge and thank my wife, Robin Purvis, for her willingness to edit my posts each week.  She has saved me countless times from my mistakes.)