Flat job growth and rising unemployment highlight the critical need for Connecticut legislators to resolve the state's ongoing fiscal crisis and fix a struggling economy.

Unemployment in Connecticut rose for a second month in March according to the state Department of Labor's latest jobs report and at 5.7% remains the highest in New England.

Unemployment-NE_041416
Connecticut's unemployment rate remains the highest of the six New England states.

“We are still struggling to come to terms with a stubborn new economic reality,” said CBIA economist Pete Gioia.

“We are adding back low-wage jobs at a much higher rate than high-paying jobs.”

Overall job growth for the month was flat, with just 300 new positions.

As a comparison, neighboring Massachusetts added 6,900 jobs in March and the unemployment rate fell one-tenth of a point to 4.4%.

At 2.6%, New Hampshire has the lowest unemployment in New England. The national average is 5%.

Labor department research director Andy Condon called the jump in Connecticut's unemployment rate "unexpected," while attributing it to more people entering the labor market.

"Job growth is occurring, but not fast enough to employ all of those recently entering the market," he said.

Higher Paying Jobs Lag

Government was among the sectors with monthly gains in Connecticut, while construction and mining, other services, financial activities, and manufacturing all posted losses.

Year over year, the state has added 15,000 new jobs. Of those, only 800 were in manufacturing and 100 in finance and insurance, typically higher paying jobs.

The majority of new jobs added over the last year were in the leisure and hospitality sector (4,600) and trade, transportation, and utilities (3,900).

Nothing would be a better catalyst for strong economic growth than for the legislature to close the state budget gap.
— CBIA economist Pete Gioia
“This only exacerbates the problems that Connecticut is facing, including fiscal instability with the state budget,” Gioia said.

“Nothing would be a stronger confidence builder, or be a better catalyst for strong economic growth than for the legislature to close the state budget gap without adding to the cost and burdens of creating and maintaining jobs.”

Connecticut has now recovered 77% of jobs lost during the recession.

The U.S. has recovered 161% of jobs lost during that same time, according to DataCore Partners.

Sector Growth

Trade, transportation, and utilities added 1,300 jobs in March, leading the six sectors that posted gains for the month.

Leisure and hospitality gained 500 new positions, followed by government (300); professional and business services (300); information (100); and education and health services (100).

Construction and mining lost 1,100 jobs for the month, the worst of the four sectors that shed positions.

Other services declined by 900 jobs, followed by manufacturing (-200) and financial activities (-100).

Hartford-West Hartford-East Hartford gained 1,100 new jobs, followed by Bridgeport-Stamford-Norwalk (1,000) and Norwich-New London-Westerly (100).

The New Haven labor market area lost 700 jobs in March.