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A little increase in Colorado’s unemployment rate may be good news.

The state’s rate rose slightly to 3.1 percent in December 2017, because more people entered the workforce than obtained jobs, according to the Department of Labor and Employment.

At one point in 2017 Colorado had the nation’s lowest unemployment rate, and businesses were having trouble finding enough workers to fill jobs. Essentially, the unemployment rate was too low. Now things appear to be easing, as more people enter the labor force.

Still, 3.1 percent unemployment is much lower than the 4.1 percent at the national level, and Colorado is ranked 10th in the country for lowest unemployment. Meaning, businesses will likely continue to have trouble finding qualified job applicants in this environment.

And there will be more businesses looking for workers.

In a separate report released in the same day by the University of Colorado Boulder Leeds School of Business, the number of new business filings in the fourth quarter of 2017 was up 9.4 percent compared to the same quarter a year earlier.

“Given the relationship between new business filings, new business formation, and employment growth, the increase in filings points to job growth in the state for the near term in 2018,” according to the report, which uses data from the Colorado Secretary of State.

In 2017, 117,648 new business filings were recorded in Colorado, and the number of businesses in good standing reached 674,979 — a record, according to the report.

Colorado’s low unemployment rate looks to be pushing up wages, as employers compete for a still small pool of talent. The State Department of Labor and Employment reports average hourly earnings increased 4 percent over the year to $28.09. This follows significant wage increases every month since July 2017.

Month AVG. Hourly Earnings YOY Change
Dec-17 $28.09 4%
Nov-17 $27.85 3%
Oct-17 $27.86 3%
Sept-17 $27.68 3%
Aug-17 $27.41 3%
Jul-17 $27.72 4%
Jun-17 $26.75 0%