The news that the national unemployment rate has dropped below eight percent for the first time in nearly four years is good news for people all around the country, but not for the struggling city of Colorado Springs.
With the unemployment has come an influx of homelessness, creating a difficult cycle in the surrounding socio-economic environment.
The unemployment rate in the Springs area is down from its staggering 9.7 percent in July to only a slightly better 9.2 percent jobless.
The U.S. Bureau of Labor Statistics recently revealed that the downward trend in the local unemployment rate is actually due to nearly 1,800 residents leaving the job market from July to August.
The number of people either working or actively looking for a job fell to a seven-year low, and the local payrolls declined to their lowest point in eight years.
“The local economy is weakening,” said Tom Binnings, a senior partner of Summit Economics, a Colorado Springs economic research and consulting firm. “I anticipate continued weakness this year and a significant hit next year due to the automatic cuts that will take effect in January in an effort by Congress to reduce the deficit.”
Colorado Springs is one of just 52 U.S. metropolitan areas that reported a higher jobless rate in July from June, as the rates were lower in over 80 percent of major metropolitan areas across the country.
Unemployment even grew in Colorado’s other six major metro areas, and the labor force grew everywhere except in the Springs and Greeley.
Stagnation in Colorado Springs is due to the fiscal cliff that Congress is fast approaching, according to Robert Loevy, a Professor Emeritus of Political Science at Colorado College. He explained that “if Congress and the President don’t work out the budget by the end of the year, then the military spending budget will be cut by 50 percent, which will hit Colorado Springs hard because of its reliance on the military.”
Professor Loevy also theorized that part of the reason the economy is currently so slow is because those involved in construction do not want to invest in new projects now, as they are uncertain about the future of the military economy in Colorado Springs.
On a positive note, Loevy said, he believes that Colorado Springs will recover from the current recession.
“Colorado Springs has always turned around before,” Loevy said. “I do believe it will recover this time once the housing market returns to normal, which will lead to a rise in employment.”
As the unemployment in Colorado Springs remains high, the number of homeless people on the streets increased by nearly 100 to 1,127, based on an annual survey performed by the U.S. Department of Planning and Urban Development.
This statistic had decreased after the city passed a no-camping ordinance and the Homeward Pikes Peak and HOT officers launched a massive outreach effort in 2010. This included programs to treat mental illness and addiction.
These efforts had the effect of dropping the homeless population from 1,463 in 2010 to 1,024 in 2011.
This success was short-lived as the population rose over the following year back to 1,127. The effect of this growing population has caused negative perceptions among Colorado Springs residents who feel that the city’s panhandlers are becoming more aggressive and intrusive.
Tim Leigh, a city council member, has been pushing to pass a no-panhandling ordinance for the downtown area.
“One of the big issues in Colorado Springs is how do we draw more people to the downtown,” Leigh said. “And one of the criticisms of the downtown is that there is all of a sudden a rush of aggressive panhandling.”
“Economic hard times are causing more aggressive panhandling,” Loevy said. “More people are being pushed out of employment so they’re more desperate for money and they push harder.”
Colorado Springs Police Officer and member of the Homeless Outreach Team Brett Iverson has learned from talking to the homeless that many of the new faces on the street had travelled to the Springs from Denver, hearing that the Waldo Canyon Fire had provided more work in the area.
Professor Loevy explained the difficulty faced by the local government, saying that the conflict causes a collision between individual freedom and the livability and functionality of downtown.
Loevy believes that when faced with maintaining this balance, the government is likely to side with “half solutions, which will be unable to solve the problem.”