Fiscal Policy, Transportation, Workforce Key Business Day Issues

Hundreds of business leaders flocked to Hartford March 14 for Connecticut Business Day, an annual event that brings job creators and lawmakers together.
Chambers of commerce from across Connecticut coordinated with CBIA to bring the state’s business community to the Capitol to hear from Governor Dannel Malloy, the co-chairs of the Commission on Fiscal Stability and Economic Growth, and legislators.

Separate breakout sessions on issues important to Connecticut businesses—fiscal policy, labor and workforce development, and transportation—drew particular interest from attendees.
CBIA president and CEO Joe Brennan introduced Malloy, who was making his final Connecticut Business Day appearance as he is not running for a third term this fall.
Malloy cited the manufacturing sector’s strong 2017 employment gains, saying the state’s “long-term investment in manufacturing is paying off.”
“For the first time since the end of the Second World War, we are seeing additional manufacturing jobs come to Connecticut as opposed to continuing the process of losing those jobs,” he told the more than 300 attendees.
“Part of that is because we made a specific decision to invest in manufacturing.”

Transportation Investments

But Malloy said Connecticut’s failure to invest in transportation has left the state at an economic disadvantage.
“I’m sure you all enjoyed your ride in today,” he said.
“If the legislature had any guts when it came to transportation they would schedule at least one month of every session to meet in Stamford.

"That sounds like a joke, but if we can't get there and if people who want to get out of New York can't get to Connecticut then the job funnel that has long existed in Connecticut for the last 65 years doesn't produce the jobs that we need to see produced in the state."
Malloy reiterated his support for highway tolls, noting that 30% of people who use state highways don't live here, adding he favors "a very substantial credit" against tolls for state taxpayers.
"We need to make investments in transportation so we can compete with communities we compare ourselves to," he said.

Fiscal Commission Report

Malloy also discussed the fiscal stability commission's report, which was released March 1 and now goes to the legislature, stopping short of endorsing the group's comprehensive package of reforms.
"I think it's a great report. I think they have said things that I've probably said," he said. "They're just smarter and you're more inclined to listen to them.

"You may not agree with every one of those recommendations, and I may not agree with every one of those recommendations, but the body of work points us in the right direction on a long-term basis."
Commission co-chairs James Smith, chairman and former CEO of Webster Bank, and Robert Patricelli, founder of Women's Health USA Inc., shared those recommendations with Business Day attendees.
Both acknowledged that businesses have concerns with some of the group's recommendations, including levying a tiered payroll tax on Connecticut companies.
"There's a bunch of recommendations you'll like," Patricelli said, "and a bunch you won't like.
"Economic growth and the state's fiscal stability are tightly connected. You can't have job and economic growth without fixing the state's fiscal problems."

State Spending, Benefits

Patricelli said many of the commission's key recommendations were drafted to support growth industries—including manufacturing, finance, and healthcare—particularly for small businesses and mid-sized companies.
He added that state government "must get a better hold on spending," noting that while progress was made in 2017 with adoption of a bipartisan budget, the legislature must reform the budgeting process.
"We were astonished to find out that Connecticut was one of just four states that allows collective bargaining for state employee benefits," Patricelli said.

"We need to join the other 46 states and give that responsibility to the legislature."
Smith said the state's fixed costs were the "biggest problem" Connecticut faces, noting that growing state employee pension and retirement costs represent more than half of all state spending.
"Legacy costs are precariously high and trending higher," he said.
"It took a long time to dig this hole and it will take a long time to dig our way out."

'Our Platform Is Burning'

Like Patricelli, Smith urged business leaders to support the commission's recommendations "as a total package."
"The recommendations in this report can change Connecticut's future," Smith said. "Our platform is burning and we need to act."

In the following breakout session on fiscal policy, several business leaders said lawmakers must consider the commission's recommendations because the alternative is more economic stagnation.
"We're at the point where we need to make changes," one said. "We needed to make them 10 years ago."
"I think we’re paying for the mistakes of the past," another attendee said.
"I know we have to bite the bullet and take on some extra responsibility, as long it's fair and achieves what we're trying to accomplish."
Others agreed with the commission's call to end collective bargaining for state employee health and retirement benefits and let lawmakers set them.

Skills Shortage

Close to 100 people, many of them manufacturers searching for skilled workers, attended the session on labor and workforce development.
Connecticut manufacturers have thousands of well-paying job openings in a profession that's clean and seeks creative people with good science, technology, engineering, and math skills.
But they're having a tough time finding skilled workers to fill those positions.

Kim Pita of Kim Pita Peaces said she recently attended a robotics competition at Waterbury's Wilby High School. While some observers might have seen students tinkering with robots, Pita saw a lot more.
"This is a pool of kids who may not want to go to college but may want to pursue technology careers," she said.
"These kids are coming out [of high school] brilliant and we must latch onto them."

'In Search of a Workforce'

Amanda Wiriya of Wepco Plastics of Middlefield believes efforts to introduce high school students to manufacturing should start even earlier.
"We can go after the high school students, but you have to go where the interest starts, and we see kids in the sixth and seventh grade who know what they want to do," Wiriya said.
She said Wepco is working to introduce girls to manufacturing.
"You don't need to go to a four-year college to make a good living," she said.
The issue, some said, is that Connecticut lacks a coordinated statewide workforce development effort.
"Most employees have gotten to the point where they’re doing the training themselves," said Kelli-Marie Vallieres of Sound Manufacturing in Old Saybrook.
Paul Lavoie, general manager at Carey Manufacturing of Cromwell and a member of the Central Connecticut Chambers of Commerce board, called on legislators to create a comprehensive workforce development program.
"Connecticut is a state with good, high-paying jobs in search of a workforce," he said.