2020 Employment Revisions Show Recovery’s Fragility

03.13.2021
Economy

Connecticut lost 20,000 more jobs in 2020 than initially estimated, posting total losses of 122,500 for the year—7.2% of the workforce.

The state Department of Labor released revised employment numbers March 12, revealing the full extent of the damage caused by the COVID-19 pandemic.

Connecticut has recovered 57% of the historic 292,400 jobs lost last March and April as restrictions were imposed across the state to mitigate transmission of the coronavirus.

Nationally, employers have recovered 58% of all COVID-19 job losses. Connecticut’s recovery is line with the other five New England states.

“The revised 2020 employment numbers are a sobering reminder of just how fragile our state’s economic recovery is,” CBIA president and CEO Chris DiPentima said.

“We are not yet out of the woods. These numbers show the significant challenges that too many of our residents and employers continue to face.”

Policy Focus

DiPentima called for policymakers to prioritize the state’s economic recovery and “get people back working.”

“It’s critical that the state legislature focus on pro-growth policies rather than adding new burdens on struggling employers as we’re unfortunately seeing from the Labor Committee for instance,” he said. 

“Policymakers must also prioritize how the state uses the new round of federal relief dollars and resist calls to spend those funds in areas that will not help our recovery from the pandemic.

“It’s critical that the state legislature focus on pro-growth policies rather than adding new burdens on struggling employers.”

CBIA’s Chris DiPentima

“We have to be smart about how we spend that money and continue to support taxpayers and employers while incentivizing private sector investment to drive the state’s recovery.

“Connecticut is still well positioned for recovery. Our response to the public health emergency is among the best in the country.

“Let’s enact policies that ensure our economic recovery is also among the best in the country.”

Regional, National Picture

In percentage terms, Maine’s job market survived 2020 with the least losses of the New England states, losing 36,600 jobs or 5.7%.

New Hampshire lost 46,100 (-6.7%) jobs last year, followed by Connecticut, Vermont (-9.1%), Massachusetts (-9.2%), and Rhode Island (-9.3%).

Connecticut’s unemployment rate was 8.1%, down 3.3 points since last spring, but the highest of the New England states.

U.S. employment shrank 6.2% in 2020.

As of January 2021, Connecticut’s unemployment rate was 8.1%, down 3.3 points since last spring, but the highest of the New England states.

The national unemployment rate is 6.2%.

Sectors, Labor Markets

Connecticut’s private sector bore the brunt of last year’s job losses, accounting for 89% of the total decline.

Employment contracted in all 10 of Connecticut’s major industry sectors lost jobs last year, with trade, transportation, and utilities declining the least in percentage terms, losing 7,000 jobs (-2.4%).

Financial activities lost 3,400 jobs (-2.8%), followed by construction (-1,700; -2.9%), manufacturing (-7,900; -4.9%), government, which includes local, state, federal, and casino employment (-13,500; -5.8%), professional services (-13,600; -6.3%), information (-2,200; -7%), education and health services (-27,200; -7.8%), other services (-8,000; -12%), and leisure and hospitality (-38,000; -24%).

As of January, New Haven saw the least year-over-year job losses—in percentage terms—among the state’s six major labor market areas, down 13,900 positions or -4.7%.

Waterbury lost 4,100 jobs (-6%), followed by Hartford (-43,200; -7.3%), Bridgeport-Stamford-Norwalk (-35,300; -8.7%), Danbury (-6,800; -8.8%), and Norwich-New London-Westerly (-14,300; -11.1%).

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CBIA IS FIGHTING TO MAKE CONNECTICUT A TOP STATE FOR BUSINESS, JOBS, AND ECONOMIC GROWTH. A BETTER BUSINESS CLIMATE MEANS A BRIGHTER FUTURE FOR EVERYONE.