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State Reports Growth of 1,700 Jobs in July

by | Aug 18, 2016 12:06pm
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Posted to: Business, Economic Development, The Economy, Leisure & Hospital Sector, Manufacturing Sector, Trade, Transportation, Utilities Sector, Jobs, Labor, State Capitol

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The Connecticut Labor Department is reporting that the state gained 1,700 jobs in July, which means the Connecticut is about 20,300 jobs away from a full recovery from the Great Recession.

“There is uniformly good news in our employment surveys last month,” Andy Condon, director of the Office of Research, said. “Payroll jobs grew. Our labor force grew and we saw our unemployment rate decline for the first time since August of last year.”

The department did revise June’s 7,900 job gain down to 5,800.

Also down in July was Connecticut’s unemployment rate. It dropped one-tenth of a percent to 5.7 percent, which is three-tenths of a percent higher than it was a year ago. The state’s unemployed declined by 1,904 in July.

Five of the 10 major industry supersectors gained jobs and five declined. Leisure and hospitality and the trade, transportation and utilities added the most jobs last month. Hiring at restaurants and accommodations boosted the leisure and hospitality supersector by 1,500 jobs, while retail trade added 1,300 jobs helping that supersector rebound from two months of declines. Professional and business services added 1,200 jobs in July and manufacturing added 300 jobs.

The government supersector shed 1,300 jobs last month — about 1,000 from local government and 300 from the state.

Connecticut has now recovered 98,800 positions or 83 percent of the nonfarm jobs lost during the recession. The state is averaging roughly 1,283 jobs per month since February 2010. The private sector is recovering at a faster rate and has recovered 96 percent of the jobs lost during the recession. The state has averaged a gain of about 1,392 jobs per month.

Gov. Dannel P. Malloy said the numbers are going in the right direction.

“We continue each and every day to grow jobs and grow confidence among our business community,” Malloy said. “The needle is moving in the right direction, and we are no doubt going to keep working to build on our growth.”

However, Don Klepper-Smith an economist with DataCore Partners said Connecticut is 20,300 jobs away from full recovery, which means it’s not likely to see a full recovery until the end of 2017.

Klepper-Smith said he would characterize the July numbers as “weak and lacking sufficient momentum.”

He said that’s because the national job gain of 255,000 was relatively strong and implies Connecticut should have seen a gain of between 2,500 and 3,000 jobs last month.

“While it’s good news that we’re still adding jobs, our recovery’s lack of strength when compared to a neighboring state like Massachusetts is important,” Pete Gioia, an economist with the Connecticut Business and Industry Association, said.

Gioia noted Massachusetts has created an additional 2.5 jobs for every job lost while Connecticut has yet to create one job for every job lost during the economic downturn.

“It really points to a sharp need for Connecticut to become more competitive regionally as well as nationally,” Gioia said. “To do that, the state must have policies in place that encourage business investment and create job opportunities.”

Maine is the only other state in New England that has not recovered 100% of jobs lost.

University of Connecticut Economist Fred Carstensen, however, says the state should be compiling its labor analysis based on a longer frame of reference than just back to the recession of 2008.

In a series of comment posted below news stories and commentaries on CTNewsJunkie, Carstensen said Connecticut’s core problem is the absence of job creation dating back to 1989.

According to Carstensen, since February 1989 the state has seen only 11 months in which total employment exceeded the previous high —  11 months in 27 years.

He also said that since 2007, Connecticut has lost 75 percent of its nondurable manufacturing and seen no recovery in its real output, measured as state GDP.

Carstensen also suggests that the current state budget foregoes more than $1 billion in federal reimbursements, which he says would equate to 10,000 additional jobs here if the dollars were spent in Connecticut.

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