Less Pay. Less Jobs. Businesses Blame Overregulation

By Shaina Cole | Contributing Writer, Rocky Mountain Voice

Colorado has spent five years building one of the most expansive labor regulatory environments in the country. Paid family leave. Wage transparency requirements. A lowered standard for harassment claims. Minimum wages that rise automatically every year, with several cities setting their own higher rates on top. Each law arrived with the same promise: this is good for workers.

The workers’ employers tell a different story.

In late 2024, before federal tariffs became a headline and before trade policy gave anyone a convenient explanation for rising costs, the Colorado Chamber of Commerce commissioned an independent survey of 169 Colorado business leaders. Cole Hargrave Snodgrass & Associates, a nationally recognized firm specializing in state chamber research, conducted interviews between November 25 and December 17. 

The survey results showed widespread reported impacts. Sixty-seven percent of employers said they had reduced the wages they offer workers because of state regulatory costs. Fifty-one percent said regulations had prevented them from hiring at all.

The data was collected before federal tariffs. It was collected entirely within Colorado’s own policy environment.

“Having conducted more than 50 studies of businesses in states across the nation,” said Pat McFerron, president of Cole Hargrave Snodgrass & Associates, “this is the greatest concern about regulations I have ever recorded.”

The Colorado Chamber has an explicit policy position favoring regulatory reform — a point worth noting. But the survey data was gathered by an independent firm, and the findings were documented months before trade policy entered the national conversation. 

The numbers go further. Seventy-six percent of employers said regulations had increased the cost of their products — costs that pass directly to consumers. Ninety-two percent said regulatory reform is necessary. The share of business leaders saying Colorado’s economy is heading in the wrong direction has climbed from fifty-three percent in 2022 to sixty-seven percent today. 

Only twenty-nine percent now expect to grow their workforce in the coming year compared to forty-eight percent in 2022. 

A Separate Voice, Same Conclusion

The Chamber was not alone in reaching these conclusions.

The same week the Chamber Foundation released its findings, an independent bipartisan coalition of more than 230 Colorado founders, investors, and business leaders sent an open letter to Governor Jared Polis, U.S. Senators Michael Bennet and John Hickenlooper, Attorney General Phil Weiser, and Denver Mayor Mike Johnston. 

The coalition, operating under the name Ensuring Colorado’s Innovation Future, had no formal connection to the Chamber. Its signatories included the CEOs of DaVita, Humana, and Liberty Global, venture capital leaders from Foundry Group, the presidents of the Denver Metro, Boulder, and Colorado Springs chambers of commerce, and leaders of six Colorado companies that have gone public.

Colorado, they wrote, is “increasingly viewed as a less predictable and less competitive environment for building and scaling technology companies, other growth-oriented businesses, and traditional corporations alike.” They cited structural, regulatory, legislative, and rhetorical factors driving businesses to competing states. They specifically named AI regulations and labor and environmental policies as barriers to growth.

Notably, the letter did not frame this as a problem for capital. It framed it as a problem for people. 

The coalition’s concern, they wrote, is for “the teachers and nurses, skilled tradespeople, restaurateurs and shopkeepers, hotel workers, fitness instructors, and service professionals” whose economic stability depends on sustained growth. “When competitiveness erodes,” they wrote, “the pain is borne locally and it lingers long after capital has moved on.”

Governor Polis signed the letter. In doing so, he acknowledged directly what the survey data had already documented — that the concerns are real and require action. His office committed to convene the business community in the coming weeks.

Dan Caruso, co-founder of Zayo Group and a prominent Colorado tech investor who helped organize the coalition, spoke more directly in public remarks. “Every time I look at a Twitter post,” he said, “when tech leaders see that and they’re trying to figure out where do we want to invest, where do we want to be, they just cross Colorado off the list.”

The Laws Employers Name

Employers in the survey pointed most heavily at labor and employment regulations, cited by forty-one percent as their top concern, followed by environmental regulations at thirty-two percent. Employer frustration did not arrive with any single bill. It built session by session, law by law. 

Take Colorado’s paid family leave program — FAMLI — which began pulling premiums from paychecks in 2023 and started paying out benefits a year later. The program’s first full year produced 174,000 claims. Actuaries had projected far fewer. 

One mid-sized employer, speaking anonymously to a researcher, documented $186,000 in gross wages paid to cover 38 employees on leave in 2024, up from 14 in the prior two years combined. Denver’s Department of Public Safety cited a 334 percent increase in overall leave usage after FAMLI launched, a spike it connected to slower emergency response times.

Beyond FAMLI, employers point to the Equal Pay for Equal Work Act — expanded in 2024 to require application deadlines on all job postings, salary range disclosures, and notification of all relevant employees within 30 days of every hire or promotion — the POWR Act, which in 2023 lowered the legal threshold for workplace harassment claims and imposed $5,000 penalties per noncompliant nondisclosure agreement, rising minimum wages with competing local rates across multiple jurisdictions, and a 2025 law that expanded personal liability for business owners in wage disputes and mandated public naming of employers found in violation.

A 2024 regulatory analysis commissioned by the Chamber found Colorado’s regulatory burden grew 7.1 percent between 2020 and 2023. The state moved from the 12th to the 6th most regulated in the country in that period. It may have climbed further since.

Where Companies Go

When the cost of operating in Colorado becomes unsustainable, some employers leave. The Colorado Chamber Foundation’s 2025 Relocations Tracker, released April 6, documents 98 company relocations or lost opportunities since 2019, with 27 in 2025 alone — the highest single-year figure since tracking began. 

When job data was available, the report tied more than 13,600 lost Colorado positions to those decisions. Colorado lost a net 34 public company headquarters between 2022 and 2025 and now holds its lowest headquarters count since 2019.

Texas attracted 21 of those departing companies. When employers gave reasons for leaving, they cited regulatory burden, specific tax or labor policies, and more favorable business climates elsewhere.

The report was compiled from public records — corporate press releases, SEC filings, and Worker Adjustment and Retraining Notification Act filings with the state. It does not capture every departure. “We believe this report is only the tip of the iceberg,” said Cynthia Eveleth-Havens, the Chamber’s chief strategy officer.

More May Be Coming

The legislature is currently considering measures that employers say could deepen the burden. 

A reintroduced version of the Worker Protection Act — which Governor Polis vetoed in 2025 — would make it easier for unions to collect fees from workers who have not joined. 

Labor groups have simultaneously advanced Ballot Initiative 43, which would make Colorado only the second state in the nation, after Montana, to require employers to document just cause before terminating any worker. Fired employees could sue for reinstatement, back pay, and attorneys’ fees with no cap on damages.

The Colorado Artificial Intelligence Act, already delayed once, takes effect June 30. It requires employers using AI in hiring or employment decisions to conduct annual impact assessments and notify consumers of AI’s role in consequential decisions. Industry groups, including the U.S. Chamber of Commerce, have called its requirements onerous, particularly for smaller businesses.

These proposals and laws move in the same direction. But the trajectory they represent — more requirements, higher liability, greater compliance cost — runs directly against what 169 employers, 230 business leaders, and the Governor himself have now acknowledged is already a breaking point.

The laws were written to protect workers. Whether they are achieving that goal, or contributing to changes in wages and hiring, remains an open question for Colorado policymakers.

Editor’s note: Rocky Mountain Voice contacted the Governor’s office with specific questions about the Chamber’s wage suppression data, and the state’s process for tracking company departures. The Governor’s office had not responded as of publication.