‘Not the Signs of a Healthy Economy’

Stagnant job growth, rising unemployment, and a shrinking labor force were the top headlines in the March employment report, sending a stark warning about the direction of Connecticut’s economy.

Employers added just 100 jobs in March, with 300 fewer people now employed than 12 months ago and payrolls 3,600 lower than in March 2008—the beginning of the last recession.

Another 7,800 people (-0.4%) left the labor force in March, with the population of those working or looking for work declining by more than 20,900 (-1.1%) over the past 12 months.

Connecticut’s unemployment rate jumped another tenth of a point to 4.8%, the highest in the region and 11th highest among all states.

“We’re not just treading water, we’re falling behind,” CBIA president and CEO Chris DiPentima said in response to the report, released May 5.

“These numbers are not the signs of a healthy or resilient economy—these are major red flags that current policies are not working for residents or businesses.”

Where Are the Workers?

Based on Department of Labor data, Connecticut has over 85,000 job openings, with the number of unfilled positions continuing to remain persistently high.

However, the state’s labor force is now 0.6% below pre-pandemic levels—in stark contrast with the national average, up 3.9% over the same period.

At 2.5%, Massachusetts has seen the region’s strongest post-pandemic labor force growth, followed by Rhode Island (2.3%), Maine (1.5%), New Hampshire (0.4%), Connecticut, and Vermont (-2.5%).

Vermont has the lowest unemployment rate (2.6%) in the region—and the fourth lowest in the country—followed by New Hampshire (3.1%), Maine (3.2%), Rhode Island (4.7%), Massachusetts (4.7%), and Connecticut.

As of March, the U.S. unemployment rate was 4.3%.

Policy Consequences

DiPentima emphasized that the latest employment numbers “aren’t leading indicators—these are the consequences of policy decisions.”

“Unfortunately, opportunities to strengthen the state’s workforce and competitiveness went largely ignored by policymakers during the 2026 General Assembly session,” he said.

“Instead of tackling affordability—like the high cost of healthcare and energy—policymakers added uncertainty, exactly the opposite of what businesses and residents need at a time of slowing growth.

The March jobs report sends a stark warning about Connecticut’s economy—stagnant job growth, rising unemployment, and a shrinking labor force are not the signs of a healthy economy—these are major red flags that current policies are not working for residents or businesses. 1/2 pic.twitter.com/6347xo2dNy

— Chris DiPentima (@ChrisDipentima) May 6, 2026

“If we want to make meaningful job gains and grow our population—the answer lies in attracting and retaining businesses and workers.

“That starts with a policy climate that focuses on affordability, rewards investment, supports growth, and strengthens Connecticut’s ability to compete.

“Connecticut employers are doing their part to attract and retain workers, with private sector wages up 4.3% year-over-year—well ahead of inflation and the national average.

“Now we need policymakers to recognize these challenges and address them appropriately.”

Industry Sectors, Labor Markets

Half the state’s 10 major industry sectors posted job gains in March, led by other services, which added 1,400 positions (2.2%).

Construction employment grew by 700 jobs (1.1%), bringing 12-month growth to 2%, the best of all sectors in percentage terms.

Manufacturing added 700 jobs (0.5%) last month, with sector employment levels now 0.2% below March 2025 levels.

Government added 100 jobs (0.04%) and education and health services—which has grown 1.7% year-over-year—also gained 100 positions (0.03%)

Professional and business services posted the largest decline for a second consecutive month, shedding 1,800 jobs (-0.8%) in March, with 12-month losses at 1.6%.

Employment in the trade, transportation, and utilities sector—down 1% over the last 12 months—declined by 600 jobs (-0.2%).

Information lost 300 jobs last month (-1%), followed by financial activities (-100; -0.1%) and leisure and hospitality (-100; -0.1%).

Hartford-West Hartford-East Hartford was the only one of the state’s five major labor market areas to see gains in March, adding 700 jobs (0.1%), with 12-month growth essentially flat (-200; -0.03%).

Employment levels in Waterbury-Shelton were unchanged for the month. The region has lost 2,000 jobs (-1.2%) since March 2025.

Bridgeport-Stamford-Danbury lost 1,000 positions (-0.2%) and is down 200 jobs (-0.05%) year-over-year.

Norwich-New London-Willimantic is the only sector with 12-month gains (700; 0.5%), losing 400 jobs (-0.3%) last month.

New Haven lost 400 jobs in March (-0.1%), with 12-month employment levels unchanged.