New Haven Register (New Haven, CT)
Conn. economy surges to top 12 in U.S.
On the strength of the hospitality sector’s rebound, Connecticut exited 2021 with one of the topperforming economies in the nation, but ranked in the bottom third when factoring in economic output for the full year, data shows.
The Bureau of Economic Analysis reports a 7.7 percent increase in Connecticut’s gross domestic product in the fourth quarter of last year, spanning both goods and services. That ranked 12th nationally, a notch behind Massachusetts, but well ahead of New York’s 4.8 percent growth rate from the preceding three months.
BEA calculated Connecticut’s 2021 GDP at $308.7 billion, an increase of nearly $26 billion from the pandemic-onset year of 2020.
Connecticut trails most Northeast states and the nation, however, for economic momentum before and after the start of the COVID-19 pandemic. Between 2018 and 2021, Connecticut saw 4.2 percent growth in GDP to rank 36th nationally, versus 5 percent economic growth in New York and 6.4 percent in Massachusetts.
But Connecticut businesses are eager to hire these days. As of Friday, more than 86,000 jobs were listed on Indeed, including 26,000 hitting the job board in the past two weeks. As of the first week of March, less than 29,400 people were receiving jobless benefits from the Connecticut Department of Labor, data shows.
“This is a state that did not grow as fast as we should for the last 30 years — but we are right now,” Gov. Ned Lamont said Thursday. “The state has momentum.”
U.S. employers added 431,000 jobs in March, according to Bureau of Labor Statistics estimates released Friday. That helped pull the official unemployment rate down to 3.6 percent, from 3.8 percent in February.
Connecticut unemployment was at 4.9 percent as of February, with the state Department of Labor estimating Connecticut employers added 7,100 jobs that month. That was enough to nudge the state above the 80 percent threshold for jobs recovered since the outset of the pandemic.
A week in advance of the GDP estimates, Lamont told a Danbury audience that he sees the Connecticut economy as “running full throttle” while highlighting burgeoning jobs in finance, health care, life sciences and manufacturing.
“Manufacturing is on the go — a lot of what was being sent overseas to China is now coming back to the United States,” Lamont said at a forum sponsored by the Greater Danbury Chamber of Commerce. “Much more capital-intensive, requires a lot more training and a lot more skills — but that’s what we got to do, that’s the biggest priority I’ve got for our state.”
While Connecticut matched the U.S. gains in manufacturing in the fourth quarter as a contribution to overall economic growth, it lodged its most significant growth in the hospitality sector, including restaurants, which as a group represent the low end of the pay scale. Of about 4,700 food-service jobs posted in the past two weeks in Connecticut, about 1 in 10 offered hourly pay of $20 or more. By comparison, 40 percent of manufacturing openings that posted since mid-March pay that rate or higher.
“Quality of jobs is still going to be an issue in Connecticut,” said Don Klepper-Smith, an economist with DataCore Partners who tracks the Connecticut economy. “Any job in this economy counts, but when you start talking about the high multipliers — pharmaceuticals, chemicals, manufacturing — of course, we want all those.”
While the Lamont administration had a major win with manufacturing conglomerate ITT’s decision to move its corporate office to Stamford from New York, Connecticut has remained reliant on its existing manufacturers adding jobs in lieu of attracting newcomers.
Other states with lower labor, real estate and energy costs have been chalking up major wins, most notably Ohio, where Intel plans to site a pair of new semiconductor plants to stabilize the supply of chips to the U.S. industry. Raytheon Technologies chose North Carolina for a new plant to make blade foils that go into Pratt & Whitney jet engines it assembles at the subsidiary’s headquarters plant in East Hartford.
In eastern Connecticut, however, the Electric Boat subsidiary of General Dynamics has been on a massive hiring binge as it prepares to build a new ballistic submarine fleet. And this week, Lockheed Martin committed to spending more than $1 billion at nearly 250 suppliers to its Sikorsky helicopter manufacturing plant in Stratford if it wins Pentagon approval for a newfangled helicopter. And
ASML has spent the past several years in a big upgrade of its Wilton plant where it makes the machines used to create chips and flat-panel displays, with Intel among the companies buying them.
“In the old days, we had too many people looking for too few jobs,” Lamont said last month. “Now it’s the opposite — and shame on us if we don’t train each and every one of the folks.”