Building on a positive job report
There are signs of life in the Connecticut economy, but the patient is hardly fully healed or ready to climb off the operating table.
The state Department of Labor reported this month that Connecticut added 4,700 jobs in January and the unemployment rate continued to fall, now standing at 8.1 percent, the lowest in seven months. In other positive news, the DOL revised its job figures for 2012 and now reports there were modest job gains - about 10,000 private sector jobs - as opposed to the slight losses previously reported.
Andy Condon, research director at the labor department, said Connecticut's economy is beginning to line up better with national job growth trends, finally emerging from a recession that most states left long ago.
Yet the recovery is scarcely complete. Connecticut has regained about 52,600 of the 121,200 jobs lost between March 2008 and February 2010, the depths of the Great Recession for the state. That's a recovery rate of 43.4 percent.
And a closer look at the January job gains show much of it came in retail, a segment of the economy that generally produces lower salary jobs. Manufacturing, which employs about 163,200 people, remained flat, and lost 3,000 jobs during 2012. A reminder that cutting government can place a drag on the economy was the reporting of 1,500 jobs lost in the public sector in January, helping keep the state's unemployment number above 8 percent.
Connecticut lawmakers need to show consistency on tax policy. Having passed $1.5 billion in tax increases two years ago to address a budget crisis, the legislature should follow the governor's recommendation and not pile on more taxes to address the latest fiscal challenges. In fact lawmakers should go further, rejecting Gov. Dannel P. Malloy's proposal to extend the electric generation tax and corporation tax surcharge, both set to expire June 30. Businesses cannot have the confidence to plan and grow when tax policies are ever changing.
The General Assembly should, however, back the governor's Comprehensive Energy Strategy. Enacting the strategy's recommendations for providing greater access to cheaper natural gas and, to a lesser extent, hydropower; adopting its emphasis on conservation; and following its call for elimination of needless energy fees would be good for the environment while lowering electric costs and boosting manufacturing.
Implementing the energy strategy, and particularly the infrastructure improvements that will be necessary to expand natural gas use, will take time, but the assurance that Connecticut is moving in the right direction can boost manufacturing growth.
Connecticut can also build on initiatives to make the state a bioscience leader. The bill requiring the Department of Economic and Community Development to create a plan for bioscience and pharmaceutical growth in southeastern Connecticut - countering job reductions at Pfizer - should be enacted.
The state should pursue the suggestion of Edison Liu, president and CEO of the planned Jackson Laboratory for Genomic Medicine in Farmington, to create a bioscience network of researchers, universities, hospitals and businesses working cooperatively and providing the state a competitive advantage.
Politically, the next year will be critical for Gov. Malloy. If the state builds upon the modest gains the Department of Labor recently reported, it will boost consumer confidence and grow tax revenues, stopping the cycle of the state lurching from one budget crisis to the next. That would be a far better scenario on which to build a case for re-election than the opposite - economic stagnation and continuing fiscal struggles.
Along with gun control and education, Gov. Malloy assures us job creation is his top priority. It needs to be.
The editorial board is composed of the publisher and four journalists of varied editing and reporting backgrounds. The board's discussions and information gained from its meetings with political, civic, and business leaders drive the institutional voice of The Day, as expressed in its editorials. The editorial department operates separately from the newsroom.
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