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Many Connecticut Residents Left Behind In Economic Recovery

by | Nov 30, 2015 6:30am () Comments | Commenting has expired | Share
Posted to: Business, The Economy, Town News, Bridgeport, Hartford, New Haven, Jobs, Labor, Nonprofits, Poverty, State Budget, Special Session, Taxes

As Connecticut’s economy rebounds from the Great Recession, certain segments of the population are seeing less recovery than others, according to a recent report.

Minorities, young workers, those who earn low wages and people with relatively low education levels are being “left behind” as the economy gains momentum and the state’s unemployment rate falls, according to New Haven-based advocacy group Connecticut Voices for Children.

The disparities are identified in the group’s report, The State of Working Connecticut 2015, which says the state is still 20,000 jobs short of making a full recovery to pre-recession levels.

“Connecticut’s recovery is mixed; some people are in a much better position than others,” Nick Defiesta, fiscal policy fellow at Connecticut Voices for Children and report co-author, said in a statement.

“Although state per capita income remains the highest in the nation, the state’s young, minority, low-income, and less-educated workers have disproportionately experienced falling wages and higher joblessness,” he said.

Among the report’s findings:

— The unemployment rate for blacks, at just over 13 percent, is more than double the 5.1 percent rate for whites. Also, unemployment rates are disproportionately high in cities like Waterbury, at 9.5 percent; Bridgeport, at 10 percent; and Hartford at more than 12 percent.

— Minority workers in Connecticut earn a median hourly wage that is, on average, $7.25 to $8 less than what white workers earn. And for all races, wage growth has not kept pace with productivity: if it had kept pace since 1979, workers would have earned a median hourly wage of $35.24 instead of the $20.46 actual wage in 2013.

— The state’s labor force recovery has not been evenly spread. While the labor force - which includes those working and those seeking work - has rebounded better than in other similar states, the percentage of workers aged 25 to 54 has dropped below pre-recession levels among those of color, with “barely one in every two black residents” employed.

“Policymakers should keep these growing disparities in mind during current budget negotiations, asking themselves whether their actions will reduce or exacerbate inequalities in economic opportunity and whether they will improve or undermine the longer term educational success and workforce preparedness of our children,” Ellen Shemitz, executive director of Connecticut Voices for Children, said in a statement.

“When we elevate demands for corporate tax relief above critical investments in health and educational services, we undermine the overarching economic goal of sustainable and shared prosperity,” she added.

To broaden “economic opportunities” for more state residents, the advocacy group is urging lawmakers to reform the tax system so taxes are based more on a person’s ability to pay. It also is recommending that the state’s Earned Income Tax Credit be restored to 30 percent of the federal credit, and that a tax credit or exemption is added to “make up for the high cost of raising children.”

The group also is urging policymakers to reform funding for K-12 schools, colleges and early childhood education programs to make them more affordable.

Connecticut Voices for Children releases “The State of Working Connecticut” report annually in partnership with the Economic Policy Institute, a nonprofit and nonpartisan think tank based in Washington, D.C.

Gov. Dannel P. Malloy and legislative leaders are scheduled to meet again Tuesday to talk about filling an estimated $350 to $370 million budget gap. None of what Connecticut Voices for Children proposed in the report has been part of the discussion to date.

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