By Tim Jackson
When you think of the job impacts of the auto industry in this country, Colorado may not be the first place that comes to mind. But a new report shows the industry’s economic impact is felt across the state.
Colorado new vehicle dealerships last year provided 26,470 jobs producing nearly $1.5 billion in earnings, according to the latest Economic Impact Report prepared by Auto Outlook, Inc. an independent automotive market analysis firm, on behalf of the Colorado Automobile Dealers Association.
Each dealership in 2009 averaged 60 jobs with a total payroll (including benefits) of $3.5 million, the report shows.
The Economic Impact Report is produced every two years. The previous Economic Impact Report, which covered 2007, showed that new vehicle dealerships generated a total of nearly 30,000 jobs in Colorado with an average of 73 jobs per dealership.
The industry, and indeed the entire state and US economy, declined to depths not seen in modern history. Yet, as is indicated clearly within the report, even in extremely tough times, the impact new car dealers have on Colorado’s economy is significant, strong and meaningful.
The 2009 jobs figures include both 16,860 jobs directly attributable to dealerships and an additional 9,610 people who were employed due to the indirect impact of dealership operations.
New retail car and light truck registrations in Colorado have steadily declined since 2001. While much of that decrease is attributable to consumers keeping higher-quality and more reliable new vehicles longer, the recession prompted a dramatic downturn. Registrations declined 28 percent from 2008 to 2009, the report states.
2010 has the makings of a better year, however. We’ve been hearing that many dealerships are back in a hiring mode so we expect to Colorado dealerships to make up some of the job losses recorded between 2007 and 2009.
The 2009 report also found that new vehicle dealerships in the state:
- Collected or paid $410 million in state and local taxes and $194 million in federal payroll taxes.
- Produced nearly $10 billion in total sales.
- Contributed $5.5 million to nonprofits.
- Spent more than $125 million on advertising.
In addition, the average dealership in Colorado spent $225,000 on capital improvements over the past two years.
As the research shows, dealers provide tens of thousands of jobs to Colorado residents and are an important component of the state’s economy. Colorado franchised new vehicle dealers are very proud of their contributions to economic growth and development as Colorado gets back on its feet.
Tim Jackson is president of the Colorado Automobile Dealers Association.