Connecticut’s Commodity Exports Rise 2.5% in 2017
Connecticut’s commodity exports increased 2.5% to $14.75 billion in 2017, led by shipments of aerospace, industrial machinery, and medical instruments products.
The April edition of The Connecticut Economic Digest, published by the departments of Labor and Economic and Community Development, reports the state ranks 27th among all states in commodity exports.
Commodity exports represent about 6% of Connecticut’s $263 billion annual gross domestic product. Exports of services are not tracked, due to a lack of data at the state level.
“Export figures for a state like Connecticut—with a large concentration of insurance, financial, and other services—understate the true magnitude of its overall export value,” the digest noted.
CBIA economist Pete Gioia agrees, saying Connecticut likely has an above average rate of service exports, adding “we are a global business powerhouse for a small state.”
“Aerospace, industrial and electrical machinery, medical and optical devices, and repair of imports which are re-exported dominate the state’s exports,” Gioia said. “This is a vital area for local companies.
“These firms not only employ a lot of high paying workers, they are in industries with very high multipliers supporting thousands of more jobs in hundreds of local service industries from banks to dry cleaners, from supermarkets to CPAs, from restaurants to temp services.”
The economic digest says Connecticut commodity exports supported 70,038 U.S. jobs in 2015.
In 2014, 5,717 Connecticut companies exported goods. Eighty-nine percent of those were either small or medium-sized firms with fewer than 500 employees, accounting for 23% of the state’s commodity exports.
Connecticut accounted for 27% of New England’s $55.25 billion in commodity exports last year, second only to Massachusetts.
France is Connecticut’s leading export destination for commodities, importing $2.11 billion in goods from the state last year.
A challenge for Connecticut is to continue to grow exports in a volatile political climate.
Shipments of electric machinery, stone, plaster, cement, railway and tramway stock, and traffic signal equipment increased markedly to South Korea.
The growth in exports to Britain was driven by increased sales of aircraft, aerospace parts, and organic chemicals.
The report also warns about the consequences of the Trump administration's announced trade tariffs, particularly on imported steel and aluminum.
"With such tariff increases, analysis must happen as to the potential impact on the defense industry, its subcontractors and supply chain," the report's authors wrote.
"Will trade partners retaliate? What will be the impact on sales? As a defense-oriented state, Connecticut must monitor the evolution of such discussions."
Gioia also expressed concerns about trade tariffs.
"Tariffs are taxes by another name and are a concern whether they be U.S. tariffs on imported steel, which hurts local small steel working parts firms, or foreign tariffs on auto or aircraft which we make parts for original equipment manufacturers," he said.
"A challenge for Connecticut is to continue to grow exports in a volatile political climate. It deserves careful, considered attention by policymakers."
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