The slowdown in employment growth in the Rocky Mountain States continued in the second quarter. By June 1999 Colorado's annual rate of growth had eased back to almost 2 percent, returning Utah to the lead in job growth among the six States in the region. Utah's growth has slowed from 1 year ago but its annual rate of growth of 2.5 percent was still above the national average. Job growth in Montana and South Dakota dropped to below 2 percent, while employment levels in North Dakota and Wyoming showed virtually no change from a year ago. South Dakota's unemployment rate of 2.4 percent was the lowest in the United States for June. North Dakota's rate of 2.5 percent was not far behind. Unemployment rates in Colorado and Utah remain close to 3 percent, while Montana and Wyoming continue to post rates above the national average.

A recent study by the American Electronics Association ranked Colorado as the third-fastest State in high-technology job growth during the 1990-97 period. As Sun Microsystems and Level 3 continue to add to their workforces, growth in this sector appears certain to continue. Utah is poised for a major expansion in its high technology sector with the announcement that Intel will build a $500-million campus in Riverton. Development is scheduled over the next 20 years with employment eventually totaling 8,000.

Spring rain has not adversely affected the winter wheat crop as much as expected, but some areas of the region remain hard hit. About 3.2 million acres of North Dakota farmland remain too wet to plant. Montana's only copper mine is staying open even as the price of copper has plummeted, and closures are widespread in other western States. Copper prices are up from their recent lows, but major improvement is not expected until the Asian construction industry is back on its feet.

An unemployment rate of less than 2 percent has not stalled the boom in call center employment in Sioux Falls. Citibank still dominates among local employers, but Specialized Card Services has embarked on an expansion that will more than double its present workforce of 800 in the next 3 to 5 years. As expected, final figures on the 1998-99 ski season show a 5.3-percent decline in skier visits compared with 1997-98.

While growth controls of some sort have been commonplace in communities such as Boulder for decades, the population growth of the 1990s has spawned concerns in other areas as well. The Denver Regional Council of Governments recently adopted an urban growth boundary as part of its long-range plan. Meanwhile, the metropolitan area has become a patchwork of growth management plans, moratoriums, building permit limits, and similar controls. A statewide plan to require large, fast-growing counties to adopt growth boundaries died in a senate committee, but proponents have promised to push for a statewide referendum on the issue. In Utah a proposal for a new highway along the Wasatch Front is facing some opposition as concerns about sprawl and adverse impact on wetlands in the area have come to the forefront. Even in relatively sparsely populated Montana, disappearing farm and ranch land is becoming more of a concern. The prospect of a wave of retiring baby-boomers fleeing cities and seeking a different lifestyle in the Rocky Mountain region has many current residents alarmed.

In the first half of 1999, the Rocky Mountain region recorded a major cutback in multifamily building permit activity. A 37-percent drop in Colorado and a 42-percent drop in Utah offset the modest gains in the region's other States. Single-family building permit activity was up in all States except North Dakota and Wyoming. The largest percentage increase occurred in South Dakota, while the second-largest percentage increase came in Colorado. Sales of existing homes in the region remained strong. As of the second quarter, the annual rate of sales totaled 244,500 homes, a 5.5-percent increase over second quarter 1998.

Renter housing vacancy rates were little changed in Denver and Colorado Springs during the first quarter of 1999. Colorado Springs' rate has been close to 6 percent for several quarters. A cutback in apartment construction in 1997 and 1998 has helped keep this market balanced after a dramatic increase in activity in 1995 and 1996. Denver's rental vacancy rate has been remarkably stable in the face of heightened apartment construction in the past 2 years. A cutback in production in 1996 was short lived, as 1997 and 1998 brought two successive new record levels of apartment building activity for the 1990s. The vacancy rate here has remained below 5 percent, but some upward movement is likely in the second half of 1999 as more of last year's surge in activity reaches the market. Salt Lake City's rate was back up by more than 5 percent in the first quarter, after dipping to 4.8 percent in the fourth quarter of 1998. The cutbacks in apartment construction in each of the past 2 years have continued into the first half of 1999. This should help maintain a balanced market for at least the remainder of 1999.

Spotlight on Rapid City, South Dakota

By July 1998 the Rapid City metropolitan area's population had reached 87,700 persons, a 7-percent increase since 1990. The area, one of the fastest growing in the State, is a trade and service center for parts of surrounding States. Tourists, retirees, and workers are being attracted to the area, which features Mt. Rushmore and gaming in Deadwood.

The local economy has shown remarkable resiliency, quickly recovering from the loss of more than 3,000 military and civilian personal at Ellsworth Air Force Base during 1996 and 1997. Expansions of existing businesses and new firms, especially in the manufacturing and financial service sectors, kept employment growing. During 1998 and during the first quarter of 1999, the annual rate of employment growth has been in the 3- to 4-percent range. This strong pace is expected to continue at least through the next year. The unemployment rate as of June was 2.1 percent. Some of the area's largest private sector employers include Green Tree Financial (consumer credit products), SCI Systems (electronic components manufacturing), Nash Finch (food wholesaler), Beverly Healthcare (nursing care), and Federal Beef (meat processing).

New home construction has been relatively stable during the past 10 years, despite some ups and downs in the economy. In 1998 permits were issued for 270 new single-family homes, slightly below the average for the decade. Most new construction is occurring in the unincorporated areas outside Rapid City. Demand is very strong for homes in the $85,000 to $100,000 price range. The average sales price for an existing home of $104,300 was up 2 percent during the first half of 1999 compared with the same period in 1998.

The rental market is currently balanced, having improved since the highly competitive market conditions during the mid-1990s when a flood of new units came on line at the same time Ellsworth Air Force Base downsized. A cutback in construction and the strong employment growth contributed to the recovery.