‘What Keeps Manufacturers Up at Night?’

Connecticut manufacturers continue to play an outsized role in Connecticut’s economy. 

Manufacturing generated 11.2% of the state’s GDP in 2025 and supports more than 156,000 jobs across the state. 

However, the just-released 2026 Connecticut Manufacturing Report—produced by the CBIA Foundation for Economic Growth & Opportunity with support from RSM US—found that rising costs, workforce challenges, trade disruptions, and rapidly evolving technology continue to pressure manufacturers.  

Those themes were echoed by industry leaders during a panel discussion Oct. 1 at CBIA’s 2026 Connecticut Manufacturing Summit. 

“Of manufacturing leaders surveyed, 93% indicated they expect costs to increase in the coming years,” noted RSM’s Brian Deming.

High Costs Erode Competitiveness

Deming opened a summit discussion with Carey Manufacturing’s Alison Carey Lynch, Forum Contract Manufacturing’s Mark Polinsky, and Mica Corporation’s Jaclyn Epstein by asking “what keeps you up at night?” 

“Materials, labor, shipping, packaging, everything’s going up across the board,” said Carey Lynch. 

“We’re seeing that in every aspect of manufacturing.”

Companies are investing in efficiency improvements, equipment upgrades, and automation to help offset those increases, but Connecticut’s high operating costs remain a significant competitive challenge. 

“You try to do the best you can to offset the cost internally, but at a certain point, there’s just nothing we can do,” Carey Lynch said. 

“We’re not in a bubble,” Polinsky said. “When we produce, we compete globally.”  

He pointed specifically to electricity, labor, and healthcare costs as areas of concern. 

“Connecticut’s costs are rising faster: cost of electricity, cost of labor, cost of healthcare,” he said. “You name it. It makes it tough to compete globally.” 

Energy, Healthcare Costs

Energy and healthcare costs generated particular concern among the panelists. 

Epstein said Mica continues evaluating ways to reduce energy consumption after installing solar panels and completing an energy audit. 

“We’re kind of going through that again to try to just see what else can we do to try to lower our costs,” she said. 

Healthcare costs remain another significant burden for manufacturers. 

“We were seeing 18%-to-20% increases in our healthcare program last year,” Polinsky said. 

Epstein said manufacturers must continually evaluate healthcare offerings to balance competitive benefits with rising costs. 

“We’re looking at that to make sure we giving the best healthcare for the best price to our employees,” she said. 

Workforce Shortage

The report also identified Connecticut’s workforce shortage as one of the sector’s most pressing challenges.  

More than 7,000 manufacturing positions remain open statewide, and 88% of manufacturers said it takes at least two weeks to fill an open position. 

Panelists said the challenge is not simply attracting workers, but ensuring critical skills and institutional knowledge are passed to the next generation. 

Carey Lynch said hiring and retention is less of a challenge for Carey Manufacturing, pointing instead to the aging workforce. 

“We have one toolmaker in house who is a genius,” she said. “He’s 75 years old. When he retires, that knowledge is gone.” 

To preserve that expertise, her company hires ahead of anticipated retirements and cross-trains employees to assume specialized responsibilities. 

Polinsky described a similar strategy centered on workforce development. 

“We’ve adopted a philosophy of kind of grow your own,” he said. 

“I think we have to kind of train our own people because there is a shortage, and we are stealing from each other because there’s not an abundance of talented technical people out there.” 

Next Generation Talent

Attracting younger workers remains critical to closing the talent gap. 

“The first step is getting young people excited about manufacturing,” Polinsky said.  

“Showing their parents as well that manufacturing is clean, exciting, and involves automation and a lot of skills that weren’t required 20 or 30 years ago.” 

Epstein said succession planning has become an organization-wide priority. 

“We need to make sure that we’re always thinking about who’s going to sit in the role next, at every level of the company,” she said. 

Artificial Intelligence

Manufacturers increasingly see technology as part of the solution to workforce shortages and rising costs, with panelists pointing to artificial intelligence as one of the industry’s most promising emerging tools. 

Carey Lynch said AI has already reduced administrative burdens within her company. 

“I use it to take the 50 policies and procedures that we have and condense it all into like 10,” she said. 

However, AI adoption remains limited among the manufacturing industry.  

63% of manufacturers surveyed for the report said they have not integrated AI in their businesses. 

“I’ve been amazed by some of our young people.”

Forum’s Mark Polinsky

Epstein said Mica has taken a measured approach to AI adoption. 

“We started with the do nots, and now we’re starting to move into the do’s,” she said. 

She also noted that AI needs to have the same oversight as an entry-level employee. 

“If you’re getting a report from an entry-level employee, you’d read it, you’d revise it, you’d spend time with it, and maybe even put in the extra effort to teach it what it didn’t do right,” she said.  

Polinsky noted that Forum Contract Manufacturing has relied on some of its younger workers to push them to use the technology to evolve the way they operate. 

“You sometimes need some outside objection,” he said. “I’ve been amazed by some of our young people who come in and just kind of transform the way we think.” 

Trade Policy

As manufacturers take steps to control their costs and improve productivity, there are still some factors out of their control.  

Trade issues continue to create challenges for manufacturers operating in global markets. 

The report found that 59% of manufacturers expect tariffs to negatively affect their business over the next year. 

Panelists said uncertainty surrounding trade policy can be as disruptive as tariffs themselves. 

“Uncertainty is becoming more of the issue than the tariffs themselves.”

RSM’s Brian Deming

“It sounds like almost the uncertainty is becoming more of the issue than the tariffs themselves,” Deming observed. 

“It’s been chaos,” added Polinsky. “Constantly changing. What is the tariff this week? What country?” 

Carey Lynch said her company previously invested in reshoring production to Connecticut, which has helped them navigate the uncertainty.  

Epstein said Mica is opening an overseas manufacturing location to serve customers more efficiently and reduce the impact of retaliatory tariffs. 

“It will allow us to regain hopefully a lot of business that we’ve lost since the tariffs were imposed overseas,” she said.  

Sector Outlook

Despite ongoing challenges, the panelists expressed confidence about manufacturing’s outlook. 

The report found that 68% of manufacturers were profitable in 2025, and the same percentage expect to be profitable in 2026. 

“We’re very confident. We are having a great year,” Carey Lynch said. 

Polinsky also said he is optimistic heading into 2027, pointing to new equipment investments, expanded capabilities, and new manufacturing capacity. 

Epstein pointed to global expansion and new sustainable packaging technologies as major opportunities for growth. 

“We really have a very unique thing in Connecticut.”

Carey Manufacturing’s Alison Carey Lynch

When asked to describe the manufacturing environment in 2027 with a single word, the responses reflected that confidence: “Exciting.” “Dynamic.” “Busy.” 

The conversation ended with a broader discussion of the collaborative spirit that defines Connecticut manufacturing. 

“We really have a very unique thing in Connecticut with the way the manufacturers all work together,” Carey Lynch said. 

That collaborative mindset may prove increasingly important as manufacturers navigate rising costs, workforce shortages, technological change, and economic uncertainty. 

“A lot of that has to do with the uncertainty of the world,” Epstein said. “Just getting comfortable with the fact that we don’t know the end of the story.”