06/15/2026
Colorado’s Budget Problem Is a Jobs Problem
Colorado cannot tax, fee, or subsidize its way out of a weak employment picture. If we want a stable state budget, we need more Coloradans working, earning, building businesses, and moving up the economic ladder.
As Ranking Member of the House Business Affairs and Labor Committee, I have seen clearly that Colorado is moving in the wrong direction. Too often, the legislature treats employers as an endless source of revenue, compliance, mandates, and paperwork. Then we act surprised when hiring slows, small businesses struggle, and the state budget gets tighter.
Employment is one of the strongest drivers of Colorado’s budget. When more people are working, the state collects more income tax and sales tax. Families are more independent. Businesses are stronger. Fewer people need government assistance.
When employment weakens, the state gets hit twice: revenues fall while demand rises for Medicaid, unemployment benefits, housing assistance, food assistance, and other safety-net programs.
Colorado’s labor market is not collapsing, but the warning lights are flashing. In April 2026, Colorado’s unemployment rate was 3.9%, still below the national rate of 4.3%. That sounds acceptable on the surface. But labor-force participation has weakened, falling from 66.6% in December 2025 to 65.2% in April 2026.
That matters. A low unemployment rate can hide real weakness if people are leaving the workforce altogether. Colorado does not benefit from a smaller workforce. Our budget is strongest when more people are working, producing, spending, and paying taxes.
The stakes are real. Colorado’s General Fund depends heavily on individual income tax and sales tax. Those dollars fund schools, roads, public safety, corrections, higher education, health care, and human services. If 25,000 Coloradans lose jobs averaging $60,000 per year, that is roughly $1.5 billion in lost wage income. That means tens of millions less in state income tax revenue before the broader economic effects are even counted.
Meanwhile, Medicaid and human services costs are already putting enormous pressure on the budget. Fewer workers paying into the system while more people qualify for services is a dangerous fiscal cycle.
The solution is not complicated, but it does require discipline. Colorado must reduce regulatory and compliance costs, stop passing labor mandates that discourage hiring, protect small businesses, measure whether state programs grow private-sector wages or simply expand dependency, and watch labor-force participation, not just headline low unemployment.
A strong workforce is the best budget solution available. More work means more revenue, less dependency, stronger families, and healthier communities. A weak labor market means less revenue, higher costs, and harder choices for schools, roads, Medicaid, corrections, and public safety.
As I travel the district this summer and fall, I will be talking directly with employers, workers, farmers, ranchers, local leaders, and Main Street businesses about what is holding Colorado back. My goal is simple: identify the most immediate and impactful changes we can bring forward in next year’s legislative session to strengthen work, support employers, grow wages, and restore fiscal common sense at the Capitol.
