TAPP models economic future

“Without growth in an amenity economy, we wouldn’t have growth at all.”

by Katherine Nettles

Gunnison County Tourism and Prosperity Partnership (TAPP) leaders are imagining how things might look around the valley in another 10 years, and they have presented some visions to other county leaders about how to shape things—or what to expect if current trends continue.

In a recent update to Gunnison County commissioners, TAPP executive director Andrew Sandstrom shared the results from a recent economic modeling study. The results showed the valley’s economy is increasingly amenity-based, and that median incomes are being driven up by higher, remote worker wages. TAPP then took these data points and contemplated how to use those and other current trends to forecast out to 2035 and inform policies and goals starting now. 

Economic model

TAPP hired Triple Point strategic consulting firm last year to analyze economic data from 2010 to 2024. Those results were released in early May and representatives from the firm shared them with commissioners on May 26.

First, Triple Point identified local employment trends from the 14-year time period that indicate significant job growth in manufacturing and real estate, and to a lesser degree in retail/business services, healthcare, restaurants/bars and in government. There have been declines in jobs at Western Colorado University (WCU), in commercial lodging and recreation and in mining.

Triple Point representatives emphasized that retail, healthcare and restaurants are the biggest economic drivers of a place and change the most. So, while other industries might see major growth, those results have relatively little overall effect.

The study determined that the overall largest current job industries in the valley are retail/business (33% of local jobs) and real estate/residential development (20%), followed by healthcare (12%), restaurants/bars (10%), government (8%) and commercial lodging/recreation (8%). Despite the large growth in manufacturing, that category remains a more minor job industry, as are WCU and mining.

Triple Point confirmed that lodging has previously grown at significant rates in the past 10 years, while other economic growth has been slow. County-wide lodging tax has outpaced sales tax and economic output since about 2013. Lodging tax has almost tripled, while county sales tax has more than doubled and economic output has gone up by 22%.

“One big thing that stuck out to me is that commercial lodging and recreation is actually down,” commented Sandstrom of the current numbers. “I think that we’ll begin to see some of the shift away from a traditional front desk tourism job and into that real estate/residential services and STR [short-term rental] area.”

Overall, the local economy adds up to about $3.5 billion annually. Triple Point representatives noted that $1.4 billion is coming from outside of the valley, and then that drives another $1.2 billion in spending. The remaining $900 million is called leakage, and means residents who shop, invest or vacation outside of the valley.

“Those external drivers are very much where TAPP is focused,” said Sandstrom. “It’s money coming in from the outside. He gave the example that without the external funds coming into a restaurant, the service workers there might not have as much spending money for their own dining and retail shopping. Most of the study then focused on how that $1.4 billion has changed over time or appears to be changing now.

The study found major increases in visitor spending (both lodging and non-lodging) and local remote worker (referred to as exogenous) income.

One takeaway from this analysis was that second homeowners contribute the most (30%), then visitors (25%), then local exogenous workers (19%) contribute more than two-thirds of the money flowing into the valley; and most of that is recirculated within the valley. However, Sandstrom said mean household income in the county has not kept pace with the increasing cost of self-sufficiency.

While local exogenous income has increased drastically (by 114%) in 10 years, overall household income in the North Valley has remained flat and South Valley income has decreased 24% when factored for inflation. Self-sufficiency standards have increased by 30%.

Triple Point representatives noted that there have been some declines in external government funding, including Medicare and Medicaid, SNAP benefits as well as public lands funding cuts.

They also noted that Western’s economic contribution has been trending down a little every year, having made up a 13% share of the economy in 2010, and 9% in 2024.

“We have shifted further in the direction of an amenity economy,” said Sandstrom. That means more retirees, second homeowners and exogenous workers want to be here for the amenities available. Traffic patterns show steady increases despite public transportation expansion as well. “Workers have shifted south, but the service industry [in the north] is where the incomes have seen modest growth,” said Sandstrom.

The study concluded that “Growth of second homes, remote workers/retirees and tourism have offset declines in government, Western and manufacturing as well as an increase in [economic] leakage. This nets to a modest gain in the overall economy.”

Sandstrom echoed that “We’ve grown in some areas; we’ve shrunk in others but we’re slightly up is the story here…without growth in an amenity economy we wouldn’t have growth at all.”

Given these issues, TAPP asked Triple Point to use the data from its study to create a math modeling of the county’s economy in about 10 years.

Looking to 2035

The modeling to 2035 assumed a baseline that all current trends continue and included rapid housing expansion with about 100 additional new units per year. It calculated “tourism shock,” in which a 25% decline in tourism would occur and a 2.3% annual decline in WCU in-person enrollment. It also projected economic expansion in research, tourism, outdoor recreation and medical services.

The tourism shock prediction is based on the study’s observation that the county has lost jobs in various outdoor sectors in 2026, and how that might ripple out to other jobs going forward. The expectation is that the baseline recovery from this would occur in about five years, if there are not additional low-snow years or major drought issues.

WCU declines were projected to be a loss of 115 full-time employees by 2034. Housing expansion could have multiple different effects depending on what type of housing comes online, explained Sandstrom.

“I’d like to be able to say that TAPP continues to be data driven,” he said.  “With these budget cuts and our spending in a bad year,” he said they are considering where best to focus attention—thus the determination to work on lodging, WCU growth and shoulder seasons. “If we don’t diversify and work against some of these trends…they compound,” said Sandstrom. One example is that the number of 18-year-olds living in the valley is currently declining, and will have ripple effects if not addressed.

Commissioner Laura Puckett Daniels had a lot of clarifying questions to fully make sense of the dense data points, but said it ultimately brought a lot of insight. She and other county staff discussed how to consider area median income when setting workforce housing rents, for example, if it is being skewed by exogenous workers’ higher incomes.

Sandstrom said TAPP is sharing this content with the city of Gunnison, as well as other municipalities in the county, in upcoming meetings.

Commissioner Liz Smith said models always involve simplification of complex systems, and that she wants to make sure the critical economic regulators for the community are accounted for without overcomplicating. “What you just did for housing, I would love to see for early childhood education,” she said.

Commissioner Jonathan Houck noted that some of the big issues such as housing, cost of living, cost of childcare and transportation issues do not exist solely in Gunnison County. “As a community of 17,000 people I think we have the advantage of being more nimble, but being more nimble doesn’t give us some secret power to evade the challenges that everyone else is facing across the country as well.” He said county leaders have been aware of many of these issues for years, and their effort to lean into WCU attendance, housing and transportation are examples. He also acknowledged the levelling out of the COVID bubble as excessive buying rushes rebalance and local revenues and housing/development initiatives play out.

Puckett Daniels said it seemed that other sectors have not grown because of the lack of workforce housing for those sectors. Sandstrom said there is more to it than that, including government spending reductions. But the Triple Point consultants said in a summary perspective that might be right.

“I’m really interested to see how things look once we get Whetstone done,” said Sandstrom.

Here, here.