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April 2005 — Vol. 83, No. 3

FROM THE PRESIDENT

How Connecticut can foster job growth

By Kenneth O. Decko

CBIA President and CEO

The state’s revised job growth figures for 2004 are better than previous monthly estimates had indicated. That’s certainly good news. But Connecticut’s growth rate (1.3%) still lagged the U.S. average (1.7%) — something that should not surprise anyone. Research has shown that the higher a state’s business costs, the lower its job growth. As any businessperson will tell you, Connecticut still is a very high-cost state.

Businesses here pay billions of dollars a year in state and local taxes and state fees — the tab came to more than $4.7 billion in fiscal 2002. Companies also face high costs for health benefits, workers’ and unemployment compensation, and energy.

Yet, state legislators right now are considering proposals that would increase business costs even more. Among them are higher taxes and bills that would raise health care and workers’ compensation costs.

If Connecticut is serious about encouraging job creation, it must become more attractive for job-creating business investments. Doing that will require reducing the business tax burden; alleviating workplace costs; and upgrading the state’s electricity infrastructure to ensure adequate, affordable energy supplies.

Costs, though, aren’t the only things hampering job creation here. So is a shortage of qualified, highly skilled workers, particularly in manufacturing and other technology-driven industries. The state needs to continue improving and modernizing its education and job training systems to ensure a competitive workforce. It also needs to upgrade our transportation infrastructure to support economic development.

All of these areas will be critical in making Connecticut a national leader in job creation. Three of them in particular — property taxes, transportation and the state’s electricity infrastructure — received special attention at our board of directors’ annual meeting in March. The board’s guidance on these and other issues enables our staff to better represent business interests at the state Capitol. On behalf of the CBIA membership, therefore, I thank all the board members who traveled to this year’s meeting, at their own expense, to participate in the discussions.