Located in the foothills of the Rocky Mountains, Colorado is the second-largest state in the U.S. The Mile High City is known for its pleasant climate and for having the highest elevation in North America, which provides spectacular views of the surrounding mountains.
The state’s economic landscape has changed significantly in the last decade. Manufacturing jobs peaked in the middle of the last century and have declined since then, while new industries, such as tech, have taken their place. Today, Colorado is considered to be a center of the “new economy.” It is home to a large number of Fortune 500 companies, which have shifted some of their operations to lower their energy costs.
The city of Denver currently hosts over 400 companies (more than any other city in the U.S.), many of which have made the decision to move operations there due to the state’s highly-productive business environment and its abundant opportunities for career growth.
The New Economy
Colorado’s economy is often characterized as being “knowledge-based,” due to the large number of technology and healthcare firms that have settled in the state over the past few decades. According to the most recent data available from the U.S. Census Bureau, nearly half of the state’s population over the age of five years old is now born digital.
In 2018, some 373,000 jobs were supported by the technology sector in Colorado, accounting for 27.1% of the state’s total employment. This was the most in the country and double the national average. Additionally, the state’s professional and business services sector provided employment for more than 1.7 million people, 23.9% of the state’s total workforce. The financial services sector supported over 1.6 million jobs or 19.2% of the total workforce. The healthcare and social assistance sectors also provided employment for a large number of people.
According to a 2018 report from the Brookings Institution, “The New Economy in the New West,” published in the Harvard Business Review, companies have moved to Denver for a host of reasons, but most notably for its favorable business climate and low cost of living.
Favorable Business Climate
One of the most significant drawcards of living in or doing business in Denver is the city’s highly-productive business environment. Thanks to its beautiful settings and its pleasant climate, many companies have decided to move there, creating a large number of jobs in the city and throughout the state.
In fact, in 2018 alone, Denver’s economy added nearly 73,000 new jobs and grew by 2.9%, making it the 17th-largest economy in the world. Additionally, over the last five years, the city has seen a 27% increase in businesses, a 15.8% rise in jobs, and an 11.4% increase in the residential population. It is estimated that the city will need to add another 40,000 residences and businesses by 2025 to accommodate future growth.
The Denver Business Journal, a local business newspaper, reports that the city is drawing companies from all over the world, due to its international atmosphere and its cosmopolitan population. Additionally, the city is home to a large number of Fortune 500 companies, a fact that draws multigenerational families and makes the city an attractive place for employees to work. Furthermore, the city’s cost of living is about 18% lower than the national average, making it a more affordable place to do business.
“The cost of living in Denver is a major draw, as is the quality of life here,” says Jennifer Jones, director of global operations for Nuwber, a business-sponsored social media network. “There is a lot of recreational opportunity, with the mountains and the lake, as well as a very active community. The cost of living is much lower than expected, which is drawing many people and businesses to the area.”
Ample Opportunity for Growth
Another significant reason companies decide to move to Denver is the city’s abundant opportunities for growth. The abovementioned Brookings Institution report stated that the city is a hub for scientific research and technological innovation, due to its high concentration of PhDs and its young, dynamic population. More than 200,000 jobs are supported by these two factors alone.
The Denver Post, a local newspaper, reports that the city’s economy continues to grow, even five years after the financial crisis of 2008, due to a low cost of living, ample opportunities for growth, and strong job creation, especially in the technology sector. Additionally, new industries, such as tech, are providing even more opportunities for growth.
“Even during the pandemic, the cost of living in Denver wasn’t that high, so you could maintain your lifestyle,” says Kyle Griffith, founder, and principal of LGR, an economic consulting firm. “As a result, even people who were financially devastated during the pandemic were able to maintain their standard of living.”
Great Place to Raise a Family
One of the most significant benefits of living in or doing business in Denver is that it is a great place to raise a family. Located in the foothills of the Rocky Mountains and surrounded by ample land, the city provides families with the opportunity to enjoy the outdoors, as well as cultural opportunities, including art galleries, museums, and theaters. Not to mention that the air in the city is clean enough for families with asthma and other breathing ailments.
The state’s economy is often thought of as being “family-friendly,” due to its abundance of child-care centers, daycare spots, and preschools. Some 87,500 kids in the metro area are currently enrolled in these types of programs, amounting to nearly one in every 10 children. Additionally, the number of stay-at-home moms in the city has risen by 24% since 2007, and they now make up 17.1% of the total workforce. More than 40% of the city’s working families with children rely on some type of childcare assistance, whether it is a stay-at-home parent or a professional caregiver.
“There is a large number of two-parent households and single-parent households that live in Denver. This makes it a very family-friendly place to live. It isn’t uncommon for businesses to acknowledge this when deciding where to locate,” Jones says.
Cost Effective
Finally, the Brookings Institution report noted that many companies have decided to move to Denver due to its highly-productive business environment and its cost-efficiency. The report stated that over the last five years, Denver’s cost of living has risen by only 11.8%, while the national average has jumped by 22%. Additionally, the city’s cost of doing business has increased by only 9.5%, as opposed to a rise of 23.3% on the national average. This shows that while costs are rising, they are rising at a slower rate in Denver than in other cities, making it a more affordable place to do business.
The city of Denver currently has one of the lowest hotel room rates in the country. It is close to major transportation hubs, including the airport and downtown Denver, making it easily accessible from wherever you are. Additionally, many large companies have their regional headquarters in the city, which provides an economic boost and draws considerable interest from potential employees seeking work opportunities.
