Connecticut’s unemployment rate in October fell below 8 percent for the first time in more than four years, the state Department of Labor reported today.
The 7.9 percent jobless rate — down from 8.1 percent in August — is the lowest since April 2009. The state hit an unemployment-rate high of 9.4 percent in the last few months of 2010.
Despite the positive unemployment report, jobs during September and October declined by 4,200 in the state at a time when a partial government shutdown was threatened, executed and finally rescinded. In fact, the Labor Department wrapped the two monthly reports into one because economists were not able to analyze the jobs numbers while they were furloughed.
“The weeks leading up to the federal shutdown, evidently, led to increased economic uncertainty and hiring indecision across the state,” said Andy Condon, director of the state Office of Research.
In the Norwich-New London labor market, 200 jobs were gained in October, but September saw a decline of 400. So far this year, the region that includes Westerly has seen 1,800 job losses — most of any major labor market in the state.
Don Klepper-Smith, chief economist at New Haven-based DataCore Partners LLC, noted in a report to clients today that statewide job losses in September totaling 4,100 combined with a further erosion of 100 positions in October now puts Connecticut below the 50 percent mark for making a full labor-market recovery since the state’s most recent low point for jobs in early 2010. He estimated it won’t be until mid to late 2016 that Connecticut will have recovered the more than 100,000 jobs it lost during and after the Great Recession.
“I was expecting much better numbers for Connecticut,” Klepper-Smith said. “Today’s job numbers ‘take us a step back from where we were.’”
He added that Connecticut’s unemployment rate appears to be improving, but only because nearly 20,000 people have left the state’s labor force over the past year. He expected the state’s unemployment rate to stay within a range of 7.5 percent and 8.5 percent over the next year — higher than the current national rate of 7.3 percent — because of “profound structural changes, only modest economic growth and tempered demand for labor... .”