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Amid a shifting economic landscape and slowing population gains, Colorado’s economy will continue to grow steadily in 2026, according to a forecast released by the Business Research Division (BRD) at the Leeds School of Business in tandem with the 61st annual Colorado Business Economic Outlook Forum in Denver.

The forecast, developed by the BRD in collaboration with the State of Colorado and insights from more than 130 leaders across the state’s business, education and government sectors, projects job growth of 0.6% in 2026, an addition of 17,500 jobs throughout the state.

Richard Wobbekind

Eight of Colorado’s 11 major industries expected to add jobs in 2026, led by the education and health services sector; trade, transportation and utilities; and government. Meanwhile, three sectors are projected to post modest losses: information; leisure and hospitality; and professional and business services.

Colorado’s real GDP is projected to rise 2.1% in 2025 and 2.9% in 2026,��outpacing national growth, which is expected to reach 2.1% in 2026. While consumption, investment and government spending are expanding more slowly, consumer resilience has remained strong, with retail sales and spending defying weaker consumer confidence surveys. Real personal consumption grew an estimated 2.5% in 2025 and is projected to notch moderate growth of 1.7% in 2026.

“Moderate growth in GDP at the national and state level may appear inconsistent with the sluggish employment growth outlook,” said Richard Wobbekind, senior economist at the Leeds School of Business and��faculty director of the BRD. “The labor market is constrained, particularly by slower population growth, which is dampened by lower levels of international immigration. When employment can’t expand as quickly, productivity has to pick up.”

Over the past 15 years, Colorado has been one of the strongest state performers in the nation, posting top-10 growth in GDP, population, employment and home prices. But its near-term growth has slowed to more middle-of-the-pack rankings as population growth, particularly from net migration, continues to slow, posing challenges for labor force and job expansion.

Still, several economic indicators showed faster growth or improved rankings compared with last year, and Colorado continues to rank among the top 10 states for per capita income, average annual pay and labor force participation.

Brian Lewandowski

“Job growth in Colorado has been subdued in 2025, and growth is absent from some of the usual areas of strength in the state’s economy," said Brian Lewandowski, executive director of the BRD. “Barring some extraordinary economic event, Colorado is projected to maintain growth in output, income and employment in 2026, though the job growth will remain below average.”

Here’s a closer look at some of the state’s key economic indicators:

• Population growth. Population growth in Colorado is expected to remain modest in 2026, rising 0.6% with a total gain of 35,100 people—split between 19,500 from natural increase and 15,700 from net migration.
• Labor force growth.��Structural demographic shifts, including the retirement of baby boomers and slower international migration, are weighing on Colorado’s labor force. In August 2025, the state’s labor force participation rate was 67.4%, down from 68.1% the previous year but above the national average of 62.3%.
• ���Ա𳾱���Dz⳾��Գ�.��Colorado's unemployment rate is projected to fall from an estimated 4.5% in 2025 to 4.1% in 2026 in response to labor supply constraints.
• Personal income.��Personal income, as well as wage and salary income, are projected to increase in 2026 by 4.5% and 3.6%, respectively.
• Inflation. Inflation averaged 2.3% in the Denver-Aurora-Lakewood metro area in 2025 and is projected to be 3% statewide in 2025 and 3.5% in 2026.

Key economic risks

The report highlights the following challenges that could impact Colorado's economy in 2026:��

• Tariffs: New U.S. import tariffs may raise inflation and create supply constraints, but they could also encourage domestic production.
• Tax cuts: The 2025 legislation is expected to stimulate spending and investment, although it will increase the federal deficit.
• Labor and immigration: Retirements and stricter enforcement are limiting labor supply, which could slow economic growth.
• Inflation and interest rates: Prices are rising, and the Federal Reserve is continuing rate cuts amid soft employment growth.
• Artificial intelligence: Adoption is likely boosting productivity but also risks job displacement, with Colorado regulation taking effect in 2026.
• Debt: National debt and interest costs are climbing, and a recent government shutdown cost an estimated $14 billion.
• Housing: Elevated mortgage rates are limiting affordability, and home prices remain high.
• Market bubble: Rapid AI investment may be overvalued, with uncertain economic returns despite potential productivity gains.
• Climate: Increasingly frequent and costly disasters threaten GDP, insurance costs and household finances.
• Health care: Expiration of premium tax credits could double insurance costs and increase the number of uninsured.