State’s Jobs Recovery Stalls in April
Connecticut’s COVID-19 jobs recovery stalled in April, with just 500 jobs added during the month. Private sector employment fell a net 600 positions.
The state’s recovery rate remains at 60% of the 292,400 jobs lost last March and April to COVID-19 shutdowns and restrictions.
CBIA president and CEO Chris DiPentima expressed concern at the loss of momentum, noting the strong gains across much of the region last month.
“The latest jobs report features some concerning trends for the state’s economic recovery that policymakers must consider,” DiPentima said.
“The net decline in private sector jobs is troubling, as our overall COVID-19 jobs recovery has stalled at 60%, below the national average and behind most of the New England states.
“Most of the region saw strong job gains last month, particularly in the private sector.”
Unemployment Rate
The state’s unemployment rate fell just two-tenths of a point to 8.1% and remains the highest in New England and one of the highest in the country.
New Hampshire’s unemployment rate is 2.8%, the lowest in the region, followed by Vermont (2.9%), Maine (4.8%), Rhode Island (6.3%), and Massachusetts (6.5%). The national unemployment rate is 6.1%.
“It seems counter intuitive given Connecticut’s high unemployment rate, but employers cannot find people to fill entry-level and skilled positions across a number of sectors, including leisure and hospitality, advanced manufacturing, healthcare, and financial services,” DiPentima said.
“Some of the factors our members are citing as barriers to hiring include childcare issues, fears of contracting COVID-19, the federal unemployment benefit supplement, and the continued suspension of the state’s work search requirement for those on unemployment.
“In addition, businesses are anxiously watching the current budget debate, with the continued push for more than a $1 billion in tax hikes leaving many employers to adopt a wait and see approach before they’ll commit to any new investments in the state.”
Work Search Requirement
The state Department of Labor announced May 20 that the work search requirement, suspended at the height of the pandemic, would be reinstated May 30, with unemployment claimants then required to demonstrate they are actively searching for a job.
Connecticut joins the more than two dozen other states that have restored the requirement.
Earlier this week, DOL and Chief State’s Attorney Richard Colangelo also announced the re-establishment of an unemployment fraud prosecution unit within Colangelo’s office.
Since March 2020, Connecticut has processed more than 1.5 million unemployment applications and paid out over $8 billion in state and federal benefits.
DOL officials say they have identified and stopped at least 150,000 false claims during that period, receiving 20,000 fraudulent applications alone over the course of just a few days in March.
Gov. Ned Lamont also announced a $1,000 incentive for 10,000 long-term unemployed Connecticut residents if they are hired and keep the new job for at least two months.
Sectors, Labor Markets
Six of the state’s main industry sectors posted gains in April, led by professional and business services, which added 3,600 jobs.
Leisure and hospitality gained 1,800 positions, followed by government (1,100), information (700), construction and mining (600), and other services (400).
Education and health services lost an alarming 4,100 positions last month, leading all losing sectors.
Trade, transportation, and utilities—which has led all sectors in jobs recovery—lost 2,300 positions, followed by financial activities (-700) and manufacturing (-600).
The key manufacturing sector has recovered just 27% of the 12,700 jobs lost to the pandemic and is one of the sectors where employers are struggling most to fill vacant positions.
Three of the state’s major labor markets added jobs in April, albeit modest gains, led by Danbury, where employment grew by 400 positions.
Hartford-West Hartford-East Hartford added 200 jobs, with Bridgeport-Stamford-Norwalk gaining 100.
New Haven posted the largest losses of the month, with employment declining by 3,800 jobs.
Norwich-New London-Westerly lost 1,000 jobs and Waterbury declined by 200.
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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.