For Immediate Release

December 22, 2008

 

TAXES AND THE ECONOMY BIGGEST ISSUES FACING CONNECTICUT ACCORDING TO CBIA ANNUAL MEMBERSHIP SURVEY

Business community urging lawmakers to be mindful of economic climate and not impose additional costs that would be harmful and cost jobs

 

Connecticut business executives believe the state is moving in the wrong direction and needs to focus on the most important issues facing Connecticut—taxes and the economy.

According to the Connecticut Business & Industry Association’s annual membership survey released today, Connecticut’s employers recognize the state’s strengths as a business location but are concerned about the growing budget deficit, state spending and the possibility of the legislature imposing additional costs on businesses already struggling to survive and retain its present workforce. 

Fifty-one percent of the respondents said taxes and spending are the most important issues facing Connecticut, while 34 percent said economic growth and job creation are the top issues.

“In Connecticut and across the country, the economy is in recession and we’re facing a serious state budget crisis,” said John R. Rathgeber, CBIA president and CEO. “Business executives are concerned about how lawmakers are going to help stimulate economic growth and balance the budget to strengthen Connecticut’s economy and prepare it for future growth.”

Business costs

When asked what single change the state could make to encourage business growth and investment, 46 percent said reduce taxes, spending and the cost of doing business in Connecticut.  Fourteen percent of respondents said create a more business friendly culture, 11 percent said create incentives for business investment, 10 percent said reduce government bureaucracy and 10 percent said improve the state’s infrastructure.

“With shrinking revenues and a growing state budget deficit, the outlook is not good, and state legislators will need to make tough decisions that will help grow Connecticut’s economy and allow us to emerge from the recession stronger,” said Joseph F. Brennan, CBIA senior vice president of public policy. 

Brennan added that legislators should learn from mistakes made during the recession of the late 80’s when the General Assembly imposed higher business taxes that cost the state 160,000 jobs.

“Lawmakers must refrain from jeopardizing our economic recovery by raising taxes and work to reduce the cost of doing business in Connecticut, so our companies can stay competitive and our residents employed,” said Brennan.

Every year the legislature, particularly the Labor Committee, considers onerous proposals that would further increase the cost of doing business here. In a recession, such proposals, if passed, would have a devastating effect on our state’s economy.  Business executives say these proposals hurt their business competitiveness.

When asked about potentially harmful proposals the legislature might consider, almost all (90 percent) of the executives responding to the survey said raising the cost of the workers’ compensation system would be the most problematic and would add significant burdens that would hurt their companies and make them less competitive.  Eight-nine percent said restricting their ability to communicate with employees about issues would be detrimental, and 85 percent said mandating a minimum amount of paid sick leave for all employees would be harmful to their business.

Health care

Health care access and affordability are major issues facing Connecticut businesses and residents alike, but despite the high cost, almost all, 97 percent of respondents provide health care benefits to their employees. 

The majority of respondents (87 percent) believe that a positive health care reform agenda that strengthens our current employer-based system must focus on reducing costs and creating greater value.  Many businesses are already taking action to address rising health care costs, including implementing wellness programs and encouraging healthy lifestyles in their own companies.

Education

A skilled workforce is of great concern to Connecticut employers, and they support a variety of high school reform measures to provide our young people with the skills necessary to be successful. Fifty-nine percent of executives said they would like to see courses in schools that reinforce the analytical and problem solving skills so necessary in today’s workforce. More than half, 56 percent support increasing students’ exposure to career options, and 53 percent, said schools should require more rigorous math and science curricula.

“With a large budget deficit this fiscal year and massive projected shortfalls in the next two years, Connecticut has a difficult road ahead,” said Rathgeber. “Legislators must realize that jobs are the best form of economic recovery and take action to promote job creation in order to give us our best chance for a quick economic turnaround and secure future.”

Transportation

State businesses need a top notch transportation infrastructure in order to get their products to market and employ and retain highly-qualified workers, but according to the survey, the state needs to make major improvements in this area.

Thirty-six percent of respondents said their biggest transportation challenge is the cost of shipping freight into and out of Connecticut.  The second biggest program according to 32 percent of respondents is employee frustration with the transportation system—an issue of traffic congestion felt across the state, but most severely in the southern part of Connecticut.

While the state has put funding into the transportation system, it hasn’t been enough to make all the necessary improvements. That will require significant revenue.  In order to pay for a modern, first class transportation system, the majority (46 percent) of respondents said they would support tolls.  Executives said the state should focus on three main areas: improving the condition of existing roads, highways and bridges (40 percent); expanding highway and road capacity (29 percent); and improving transportation options that link major rail and bus terminals with employment centers (12 percent).

Methodology

The survey was conducted by mail and email in early December.  A total of 711 respondents completed the survey for a return rate of 12.4 percent and a margin of error of plus or minus 3.8 percent.

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CBIA is the state’s largest business organization, with 10,000 member companies.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For more information contact Nancy Andrews, CBIA media relations manager, at 860-244-1957 or andrewsn@cbia.com.

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