An unexpected spike in new business filings is reason for optimism? | | Leeds School of Business

A busy quarter for company formations is another data point supporting Colorado’s economic strength from the pandemic.

If the current economic situation shows signs of optimism, Brian Lewandowski suggests looking at the recent rate of business formation in Colorado.

Lewandowski, executive director of business research at Leeds, said the fourth quarter of 2022 saw the highest level of new entity filings since the BRD began tracking quarterly metrics in 2007. said. 2011.

“Colorado remains in the top 10 in many categories that measure economic health,” Lewandowski said. “And while business reports don’t necessarily represent future economic health or suggest a more positive outlook, the strength of this data point is another indication of Colorado’s future strength.” It seems to be one indicator.”

Learn more: Read the full report

The fourth quarter is typically the weakest period for business formation, Lewandowski said, and the fourth quarter results are particularly noteworthy. In the fourth quarter of 2022, he had nearly 50,000 new entity filings, with total new entity filings up 37.2% year-on-year and up 11.8% from the previous quarter.

Other highlights from the just-released quarterly business and economic indicators report:

• The country surpassed its pre-pandemic peak in employment, adding 23.2 million jobs between May 2020 and December last year after cutting 22 million jobs during the lockdown. Meanwhile, Colorado continues to lead in hiring, with her 3.2% job growth since May 2020, her 10th highest in the nation.
• Real GDP beat forecasts for the second half of the year after a negative first half total. Personal consumption (2.1%), investment (1.4%) and government spending (3.7%) all increased in the fourth quarter, and net exports improved for his third straight quarter.
• Other state indexes are more complicated. One example: Gas prices in Colorado dropped significantly after peaking at $5 a gallon in the summer, but from late December to mid-January he rose 92 cents. As another example, the consumer price index basically followed the national trend year-on-year, but Denver’s core inflation rose his 6.7%, above his 6% US average. increase.

Quarterly business and economic indicators reports measure correlations between various filing data from companies and broader economic indicators. Today’s report follows the latest Leeds Business Confidence Index, which recorded continued pessimism by industry leaders in Colorado.

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