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May 2005 — Vol. 83, No. 4

FROM THE PRESIDENT

Manufacturing still vital but vulnerable

By Kenneth O. Decko

CBIA President and CEO

Listening to some news media stories, you might think manufacturing had no future in Connecticut, or even the U.S., for that matter. But that would be wrong. Manufacturing is still an important and thriving part of our economy.

Nearly $30 billion, or 17.6%, of Connecticut’s gross state product comes from manufacturing. In addition, Connecticut’s 5,500 manufacturers employ nearly 200,000 people in our state — 18% of the state’s private-sector payroll. The most recent figures (2002) show that these manufacturing employees collectively earned over $11 billion in salaries and wages, and paid 18.4% of Connecticut’s personal income tax revenues. Manufacturers themselves paid $170 million in sales and use taxes, $154 million in corporate income taxes, and more than $200 million in municipal taxes.

Manufacturers purchase more than $10 billion worth of goods and services a year from other Connecticut businesses, including $3 billion worth from service firms. That spending supports jobs in other sectors of the economy. Each new job in manufacturing creates up to three jobs in other industries.

The loss of even one manufacturing company is a blow that hurts the whole state.

That’s why Connecticut needs to address certain serious problems here that have led to manufacturing job losses. In particular, the state must ...

  • work to reduce manufacturers’ costs for taxes, health care benefits, workers’ compensation and energy;
  • make sure young people graduating from state schools have the academic, technical and critical-thinking skills needed in manufacturing workplaces; and
  • provide support for retraining existing workers to ensure that Connecticut remains a leader in innovation and productivity.

CBIA applauds the state’s current efforts to reform the technical high schools and to create the new Regional Center for Next Generation Manufacturing. As the center’s “industry partner,” CBIA is working with several other groups to hold a next-generation manufacturing conference and launch a careers campaign in May.

Now, the General Assembly needs to do its part by rejecting proposals to raise taxes or otherwise increase manufacturers’ costs.