Despite the unemployment rate rising from 3.6% to 3.8% in December, the Connecticut Department of Labor (CTDOL) assured that 2023 overall was a year of “solid growth” with the “highest two-year job growth than in any pre-pandemic time period since 1999,” in its latest report.
Throughout the year, Connecticut employers added an estimated 22,700 jobs, finally recovering and eclipsing those lost in April 2020 due to the COVID-19 pandemic. However, in December, nearly 2,500 jobs were lost as six of the 10 industry supersectors experienced declines (See the table below for the full breakdown)
“December was not a growth month; however, Connecticut’s economy remains strong and stable with employers having added an estimated 22,700 jobs this year,” Commissioner Danté Bartolomeo said in a press release. “In 2022 we saw a similar pattern of months of strong early growth that tapered in late 2022 but produced strong early 2023 hiring.”
“Overall, Connecticut’s unemployment rate remains very low and employers continue to hire across industry sectors,” he added.
Even with the setback, the CTDOL shared that the current unemployment rate is still below December 2022’s 4%. If 2023’s overall trends are sustained, and the United States avoids a recession, CTDOL Office of Research Director Patrick Flaherty expects “Connecticut’s economy to continue to show solid growth,” as he stated in a press release. He shared that the agency would release “actual data for 2023” on March 8, which will “give us a good overview of how industry sectors are performing.”
The positive sentiments echo Gov. Ned Lamont’s remarks to hundreds of business leaders during the Connecticut Business and Industry Association’s (CBIA) “Economic Summit + Outlook 2024” on Jan. 18. He expressed that the state had “momentum” with a fiscally responsible budget passed in June 2023 — that provided historic income tax cuts for the middle class — as well as a recent demographic boost; however, the state “still has a long way to go” to remedy financial woes of the past and current issues related to childcare, housing and labor force training.
To address the latter, the governor announced the launch of Jobs.CT.gov, designed to provide various trainings for job seekers, and to connect employers with potential employees. As he told CBIA’s attendees, the site’s goal is in “making sure you have the trained workforce you need.”
Currently, according to the CTDOL’s report, employers have 75,000 jobs posted across a broad cross section of industries; and the state has about 30,000 weekly unemployment filers.
With renewed optimism over 2023’s results, still more can be done to improve Connecticut’s business climate, as the governor suggested. In a recent study by the Tax Foundation, the Constitution State suffers from one of the nation’s most burdensome tax climates, ranking 47th overall for the ninth consecutive year. The state finished between the middle to bottom-of-the-pack across several subcategories: Corporate Tax (30th); Individual Income Tax (46th); Sales Tax (23rd); Property Tax (50th); and Unemployment Insurance Tax (26th).
As the new legislative session begins Feb. 7, lawmakers should not only see this time as an opportunity to provide relief to businesses, but also heed that restrained spending — like those enforced by the bipartisan 2017 fiscal guardrails — have helped spur the economic gains in 2023.
