CT Economy ‘Stuck In Neutral’
If Connecticut’s economy was a car it would be “stuck in neutral,” Connecticut Business and Industry Association Economist Peter Gioia said after reading the latest jobs report.
The state’s unemployment rate declined for the second month in a row in December, but it’s not because more people are finding jobs. The state’s unemployment rate dropped from 8.9 percent to 8.6. percent, but it comes at a time when the labor pool also fell by 9,900.
That means in addition to shedding 1,800 jobs in December, the state will finish 2012 with a net loss of 100 jobs.
“The state’s trend of a declining labor force continues for the sixth month in a row and was the primary factor behind the declining unemployment rate in December,” Andy Condon, director of research for the Department of Labor, said. “With the arrival of the December preliminary jobs report it is apparent that the rate of job growth slowed considerably in the last half of the year, however, we expect the level of jobs in the state to be revised upward when the benchmark is complete in March.”
But not all the news for December was bad.
“The only bright lining in the report was the 800 jobs added in manufacturing and 500 in construction,” Gioia said.
The report also found that the leisure and hospitality supersector regained all of the jobs lost in the Great Recession. The education and health services supersector never lost jobs during the past few years and in fact accumulated 25,000 jobs since the recovery began in February 2010.
But there are several industries that continue to lose jobs as the state struggles to recover from the recession. The government, financial services, manufacturing, and construction industries have continued to lose jobs even after the recovery began in February 2010.
The seasonally adjusted civilian labor pool for December was down a record 45,000 over the year, and 9,900 from just last month.
“This represents the second largest monthly decline in civilian labor force ever noted in the state, going back to 1976 when electronic records began and the sixth consecutive significant decline going back to July,” according to the labor report.
The report was released the same day as Gov. Dannel P. Malloy announced he wants the state to borrow $200 million over the next 10 years to help lure more bioscience companies to the state. He made the announcement during the groundbreaking for the Jackson Laboratory of Genomic Medicine.
The state gave Jackson $192 million in forgivable loans to create 300 jobs over the next decade. It will also receive up to $99 million in research grants.
Malloy’s request to borrow $200 million, which will need legislative approval, comes at a time when the state is facing a $1.2 billion deficit. But an unapologetic Malloy continues to insist investment is necessary to ensure that the bioscience industry thrives in the state.
There are some who share that belief.
“Ongoing investment in bioscience will result in high-value job growth,” Claire Leonardi, executive director of Connecticut Innovations, said. “This plan ensures we continue to build a strong base in the short term, and in the long term it allows us to leverage additional investment to increase overall economic growth.”