Business leaders attending the ColoradoBiz/UMB Financial Top Company awards retreat in Napa, Calif., lamented a lack of qualified workers to fill openings but expressed “cautious optimism” in discussing Colorado's economic prospects in 2013. Executives from 11 Top Company winners attended the annual event.
Against a backdrop of improving national economic news including gains in home prices and starts, slowing increases in health-care costs, unemployment rates trending down and consumer confidence rising, executives pointed to labor-related issues as a potential barrier to growth.
Tom Tolkacz, longtime CEO of Swingle Lawn, Tree & Landscape Care and winner in the services category summed up the “good news, bad news” scenario facing Colorado companies. “We're currently seeing our best year since the recession. But we feel like we could have grown our business significantly more than we did if we were fully staffed. We don't know where the people are going to come from to fill our positions.
“From entry level unskilled labor all the up to skilled positions like engineers, it seems like those companies who are hiring are struggling,” he said.
Melissa Grandchamp, director of human resources at Ping Identity, a Top Company software-category winner, echoed Tolkacz’s sentiment. “We grew 67 percent last year just in head count ... we can't hire fast enough and find talent fast enough. We're finding the universities in Denver don't graduate a lot of talent in technology – so we're trying to do a lot of visibility at the high school level and track it through to college. But we’re doing great.”
Brett Huston, executive vice president at SpectraLogic, a robotics and automated storage libraries manufacturer and winner in the technology category, agreed. “We're doing fine – Europe is slow, but in the U.S. it continues to be a great ride but we can't hire fast enough,” Huston said, also citing a lack of technical talent, including engineers.
Labor issues aside, executives were optimistic about national news and bullish on Colorado’s current standing. “We just haven't seen the downtick we probably thought we would,” said Sandy Rothe, managing director of Deloitte's Denver office and event co-sponsor. “Part of that is Denver's doing better than much of the rest of the country, though even nationwide we continue to grow. Most of our clients are profitable, skeptical if profitable, as many aren't making the investments we'd otherwise see them do; but they're fundamentally pretty healthy.”
Robin Wise, Junior Achievement-Rocky Mountain president and CEO of and co-winner in nonprofit category, also suggested companies are still cautious. “Our supporters … have not really dialed back their giving ... but we have seen organizations look hard at where they give and what they give to. Companies are also looking to give more to fewer and looking at making their charitable contributions go further in terms of branding and return on investment.”
Executives also heard from UMB Executive Vice President and Chief Investment Officer KC Mathews, who asserted that a “fiscal-cliff” would likely be avoided given the significant blow-back politicians might experience, but agreed with others who forecast very modest GDP growth over the next decade – in the 1.8 percent to 2.2 percent range.
Mathews also commented on the dampening effects of the current labor situation, suggesting that extended unemployment benefits may be working to keep otherwise qualified – and much-needed – workers out of the labor pool. “An extended unemployment benefit is not stimulative. The labor participation rate, the percent of individuals active in the job market is … is 63.6 percent, the lowest rate in 30 years. It’s 66 percent on average since 1980. Six million workers have basically said 'I'm done.'”
Yet Mathews also pointed to housing as a bright national and regional segment, citing the housing ecosystem as a potential high-growth opportunity in markets like Colorado.
Go here for more information on the ColoradoBiz/UMB Financial Top Company awards.