Connecticut is one of the epicenters of the $70 million campaign to pressure states and municipalities to raise the minimum wage to $15, despite the damaging effects that a steep minimum wage increase would have on workers. The money for the “Fight for $15” campaign comes from the dues of members of the Service Employees International Union (SEIU), which in Connecticut represents many state employees, as well as health care and food service workers. A state board, the Connecticut Low Wage Employer Advisory Board, whose membership includes an SEIU director, will hold a hearing in Bridgeport next week on whether or not the state should raise its minimum wage.
Connecticut’s workforce – the number of people of working age in the state – is projected to shrink by 9.3 percent over the next 30 years, according to population projections released by the Demographics Research Group at the University of Virginia. The factors driving the decline are the state’s low birth rate, an aging population and the migration of Connecticut residents to other states. The outmigration of young adults is particularly worrisome.
While we in Connecticut may have become numb to our last place finishes on state rankings, the latest study shows just how unprepared the state would be if it were hit by another economic downturn or some other crisis. The study, published by the Mercatus Center at George Mason University, ranks Connecticut in last place out of the 50 states for “fiscal condition.” The rankings for this study take into account things like how much debt the states carry, whether they have a decent rainy day fund, and whether or not they can pay their bills in the short- and long-term.
This year we’ve tried to shine a light on Connecticut’s bonded debt, as well as our pension and retiree healthcare liabilities. When all of this debt is combined, Connecticut is one of the most indebted states in the nation. A new report by J.P. Morgan’s Michael Cembalest provides additional clarity.
What a difference a year makes. Last year, Senate President Martin Looney presided over the passage of a budget that included $1.8 billion in tax hikes and canceled tax cuts. Those tax increases fell largely on businesses and wealthy state residents. Last night, Looney seemed to repudiate his actions of a year ago, as he shepherded a budget through the Senate that included over $800 million in cuts to planned spending, and contained no major tax increases.
The line item for state employee pensions is one of the fastest-growing items in the state budget. This year, the state will contribute $1.5 billion - almost ten percent of the General Fund - to the state employee pension fund, which still won’t be enough to put a dent in the unfunded liabilities. According to new information released by the Yankee Institute on its website CTSunlight.org, 885 retirees received pensions over $100,000 in 2015 -- including 12 who earned pensions over $200,000 a year.