Connecticut's economy lost 1,700 jobs in December, ending 2016 with a net loss of 2,000 jobs.
While 2016 began strongly, with 11,300 jobs added through June, Connecticut employers posted losses in five of the six remaining months.
The state has now recovered just 70% of the 119,100 jobs lost during the 2008-2010 recession—slowest among the New England states and well below the national average of 182%.
“We have a significant challenge going forward in terms of improving our economy, particularly in creating jobs,” CBIA Economist Pete Gioia said today.
“Creating jobs solves a myriad of problems. It improves the housing situation, provides more income, and creates more tax revenue.”
Connecticut’s job recovery is vastly different when compared with neighboring Massachusetts. The Bay State added 6,600 jobs in December and gained 75,000 in 2016.
Massachusetts has recovered 313% of jobs lost during the economic downturn.
“How we can have a discrepancy of 77,000 jobs with our neighbor to the north on a year-over-year basis should really set off alarm bells and questions for policymakers,” Gioia said.
“These numbers only underscore the Governor’s message emphasizing the need for stability, predictability, and restoring business confidence."
Unemployment Rate Falls
The Connecticut Department of Labor report also revised down November’s originally reported 2,100 job gain by 200 jobs to 1,900.
The state’s unemployment rate fell three-tenths of a point in December to 4.4%, the lowest mark since July 2007.
Why the differing trajectories for job growth and the unemployment rate?
Labor department research director Andy Condon said the December report continued a recent pattern of mixed signals.
Creating jobs solves a myriad of problems. It improves the housing situation, provides more income, and creates more tax revenue.
DataCore Partners' economist Don Klepper Smith noted Connecticut’s population dropped by a net 8,278 people between mid-2015 and mid-2016, with 29,800 residents moving to other states.
“In effect, the state is now at a crossroads,” said Klepper-Smith. “We either make the hard political choices to move the political needle toward fiscal discipline and living within our means, and boost business confidence in the process, or we don’t.”
The private sector lost 1,600 jobs in December and is down a net 1,000 positions or -0.1% for 2016.
Six of the state 10 industry sectors shed jobs in December, led by professional and business services, which lost 1,700, ending the year down 2,500 jobs, the worst of any sector.
Other services lost 500 jobs for the month (up 800 for the year); trade, transportation, and utilities shed 400 positions (-2,000); information dropped 200 (no change); construction and mining fell 100 (-1,900); and government was down 100 (-1,000).
Education and health services gained 800 jobs in December and led all sectors in annual growth with 2,300 new jobs.
Manufacturing added 300 jobs for the month to finish the year with 1,000 new jobs--just the third time in the last 26 years the sector posted annual job growth.
Financial activities added 200 jobs (up 2,000 for the year) while leisure and hospitality grew by 100 (-600).
Bridgeport-Stamford-Norwalk was the only labor market area to add jobs in December, gaining 1,300 positions.
Norwich-New London-Westerly was unchanged for the month, while New Haven lost 900 jobs and Hartford-West Hartford-East Hartford shed 200.