Unemployment Dips Below 8 Percent, But Job Growth Stalls
It’s the first time Connecticut’s unemployment rate has dipped below 8 percent since April 2009. The Labor Department said Thursday that this is the lowest unemployment rate that the state has seen since the economy began its recovery in February 2010.
However, in September, the state lost about 4,100 jobs, and in October employment remained largely flat.
“Overall, the report was disappointing,” Connecticut Business and Industry Association Economist Peter Gioia said.
But Gioia said there are some bright spots. Construction, for example, saw an increase of 5,500 jobs over last year. On the other hand, high-value industries such as manufacturing and financial services are down in employment year over year. The later is something Gioia said is a “concern” for the economy going forward.
Labor officials didn’t disagree. They said the report sends a mixed message.
“The September and October reports are sending mixed signals about Connecticut’s labor markets,” Andy Condon, director of the Office of Research at the Labor Department, said Thursday. “The weeks leading up to the federal government shutdown, evidently, led to increased economic uncertainty and hiring indecision across the state.”
Thursday’s unemployment numbers include both September and October because the federal government shutdown impacted workers at the U.S. Bureau of Labor Statistics. The state relies on BLS data in compiling its monthly reports.
“On a positive note, the state’s unemployment rate has declined for two months in a row primarily driven by a reduced number of unemployed individuals,” Condon said.
Labor officials said hiring in the private sector in October was up by about 1,000 jobs, but there was a decline in government-sector jobs. This year, Connecticut has added about 1,100 jobs per month in the private sector, which is slightly better than last year when it was only adding about 960 jobs per month.
Job growth during the first 10 months of each year since the recovery started in February 2010 has been modest but quite consistent in the state, according to labor officials.
In October, five industry supersectors posted employment gains, while five exhibited declines. The largest job gain came in the education and health services supersector, which added 1,400 jobs. That was followed by the construction supersector which added 600 jobs last month.
The leisure and hospitality supersector did well in October adding 500 jobs after a drop in September.
“A warm and hurricane-free October seemed to help the end of the tourist season after a decline in September,” labor officials said.
Local and state government lost about 1,100 jobs in October, but federal government employment levels were unchanged as furloughed federal workers were eventually paid and counted as working.
The manufacturing supersector lost about 300 jobs in October. The industry that relies heavily on defense-related manufacturing was less impacted by the federal shutdown than expected.
Since the employment recovery began, Connecticut has recovered 58,900 positions, or 48.6 percent of the 121,200 seasonally adjusted total nonfarm jobs that were lost. In order to reach pre-recession employment levels, the state will need to add 62,300 more jobs.