Connecticut's jobs recovery continued in August, with employers adding 3,300 jobs, led by strong gains in the leisure and hospitality, professional and business services, and manufacturing sectors.

The August gains represented a slowdown following the 11,100 jobs added in July, the strongest month of the year to date.

Connecticut has recovered 69% of the historic 292,400 jobs lost in March and April last year to pandemic-related shutdowns and restrictions.

Maine leads the New England states at 81%, followed by Vermont (79%), New Hampshire (74%), Massachusetts (70%), Rhode Island (69%), and Connecticut. The U.S. recovery rate is 76%.

The state's unemployment rate fell one-tenth of a point to 7.2%, two percentage points higher than the national rate and the highest of the New England states.

Vermont and New Hampshire have the region's lowest unemployment rate at 3%, followed by Maine (4.9%), Massachusetts (5%), and Rhode Island (5.8%).

'Frustrating Riddle'

CBIA president and CEO Chris DiPentima called the August jobs report, with growth in a number of key sectors, "welcome news for Connecticut’s pandemic recovery."

However, DiPentima cautioned that the slow pace of Connecticut's jobs recovery compared with the region and the country was causing growing concern.

“Employers are faced with a frustrating riddle," he said. "We have a record number of unfilled job openings, yet there are 91,000 fewer people working than in February last year. 

“While the country is on track to recover all COVID job losses in nine months, Connecticut is looking at 21 months to regain those jobs.

“Employers are trying everything—higher pay, expanded benefits, sign-on bonuses, flexible work policies—and only making incremental gains.

"The faucet should be fully running, yet it's a steady drip. We're seeing this across all industry sectors at every level, from entry level positions to the most advanced skilled jobs."

Unemployment Claims Jump

DiPentima also noted the August jump in the number of Connecticut workers filing for first-time unemployment benefits, up 19.4% from July, which saw the lowest number of claims since February 2020.

"Why would these people be filing for the first time in August?" he asked. "It's probably not a seasonal drop as we typically wouldn't see that until later."

Economists have cited federal unemployment supplemental benefits as one of the factors suppressing job growth, along with the shortage of childcare, COVID-related health concerns, retirements, and supply chain disruptions.

"The state that solves this problem first will be the first to fully recover economically."

CBIA's Chris DiPentima

“Federal unemployment benefits expired Sept. 4," DiPentima said. "Next month’s employment report will be very revealing.

"If we don't see a sizable growth in jobs in September, then we'll need to pull together the private and public sectors, including educators, to develop and implement solutions.

"The state that solves this problem first will be the first to fully recover economically."

Sectors, Labor Markets

Seven of the state's 10 industry sectors saw gains in August, led by leisure and hospitality with 1,800 new jobs (1.4%).

Professional and business services added 1,600 positions (0.8%), followed by manufacturing (1,100; 0.7%), other services (700; 1.2%), financial activities (600; 0.5%), construction and mining (500; 0.9%), trade, transportation, and utilities (400; 0.1%).

Employment was unchanged in the information sector, while government lost 2,200 jobs (1%) and education and health services shed 1,200 positions (-0.4%).

State Department of Labor officials said the public sector losses were mainly in local government.

Five of the state's main labor market area posted gains last month, led by Bridgeport-Stamford-Norwalk with 3,600 new jobs (1%).

Hartford added 2,600 jobs (0.5%), followed by Waterbury (400; 0.6%), Norwich-New London-Westerly (300; 0.3%), and New Haven (200; 0.1%).

Danbury lost 100 jobs in August (-0.1%).