Connecticut’s Economy Is Showing Positive Signs

by Christine Stuart | May 30, 2012 7:06pm
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Posted to: Business, Town News, Jobs, Labor

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While it may just be anecdotal, a business development manager for a utility company said Wednesday that Connecticut’s economy seems to be improving and businesses are moving in or expanding.

“Our phone is running off the hook,” John O’Toole, a business development manager for Northeast Utilities, said.

The utility recently helped a company relocate to Oxford from the Bronx, a Naugatuck company closed its plant in Mexico and moved the jobs back to Connecticut, and a bullet proof vest company consolidated its operation in Monroe after closing its facility in North Carolina. And those are just a few examples O’Toole was able to rattle off.

The economy, according to the Connecticut Economic Resource Center, which sponsored the gathering at the Rocky Hill Marriott Wednesday, is showing some positive trends. One of those positive signs is the improvement in commercial leasing, which is up slightly over 2010.

But statistics don’t tell the whole story. Sometimes its about how the state’s business climate is perceived.

O’Toole pointed out that unlike Texas, Connecticut doesn’t seem to express the same sense of pride in its state. That’s something he is hoping the state’s re-branding initiative “Connecticut Still Revolutionary” will begin to change.

In an effort to support the two-year, $27 million tourism campaign and re-branding initiative, Northeast Utilities is sponsoring a website called InnovateCT to celebrate the revolutionary inventions of Connecticut’s residents and companies.

“We have a tremendous amount to be proud of,” O’Toole said.

Department of Economic and Community Development Commissioner Catherine Smith, who was introduced by O’Toole, said Gov. Dannel P. Malloy would be the first person to point out that Connecticut has been lagging in job growth for the past 20 years and its something his administration has been working hard to change.

“We have made a lot of progress already in the first year, but we can’t take credit for all of it,” Smith said. “But when the governor came into office the unemployment rate was 9.3 percent, it’s down to 7.7 percent.”

She said putting people back to work is very important for this state because the impact on state revenue is huge. She said the state has tightened its belt on the spending side, but its costs still have gone up dramatically.

“We’re doing everything we can to keep the cost of government down, but if you don’t see a growth in your revenue obviously that makes it even harder on the expense side. To avoid deficits, to avoid a lot of layoffs in the future is to make sure we keep growing the revenue. Jobs is the best way to do that,” Smith said.

During a special session last October, the General Assembly approved a new set of tax credits, forgivable loans, tax abatements, and hiring incentives for businesses both big and small. It had planned to expand some of the provisions in the legislation earlier this month, but the bill died on the House calendar.

Smith said she hopes it will be raised during the June 12 special session, but if it isn’t, it’s not the end of the world.

The revised legislation wouldn’t necessarily increase the amount of money the General Assembly plans to bond for the package, but it would increase the amount certain companies can receive under the program.

“It just allows us to spend it on slightly different companies,” Smith said.

The revised legislation would expand the Small Business Express program to companies with 100 employees. Currently it’s only available to companies with 50 or fewer employees.

But with 700 applications submitted for the Small Business Express program and millions already given out under other provisions of the bill House Minority Leader Lawrence Cafero suggested last week that the state would run out of money to fund the program as it currently exists.

He said 80 percent of the $100 million set aside for business loans and grants has already been allocated through the first October bill. He said the bill Democrats are looking to pass simply “changes eligibility requirements and allows state agencies to keep four percent of the funding to pay for the costs of operating the programs.”

Smith said she doesn’t know exactly when the funding will run out, but it won’t be before the end of the fiscal year. She said if the demand continues to be high she might ask for more money during next year’s session.

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