State's loss of jobs in August called 'major retreat' from earlier momentum
With state lawmakers about to finally vote on a budget, the state Department of Labor reported Thursday that Connecticut lost an estimated 3,900 jobs last month, while July’s previous estimate of 600 jobs lost was revised to 1,100 jobs lost.
The numbers come from business payroll surveys administered by the U.S. Bureau of Labor Statistics.
The number of unemployed residents in the state fell by 4,300 last month while the number of employed residents fell by 5,600, resulting in an unemployment rate of 4.8 percent — down two-tenths of a point from July.
“August’s decline of 3,900 payroll jobs leaves the three-month average job gain in Connecticut nearly flat,” Andy Condon, director of the state labor department’s Office of Research, said in a statement. “Nevertheless, due to a decline in the state’s labor force, the unemployment rate fell to 4.8 percent.”
Over the past 12 months, nonagricultural employment in the state has grown by 6,000 jobs.
Pete Gioia, an economist with the Connecticut Business and Industry Association, said in a statement that the monthly jobs report “reinforces the critical need for lawmakers to adopt a budget that will change the state’s direction.”
“This is a major retreat from the positive momentum we saw earlier this year,” Gioia said. “It’s vital that policymakers focus on job creation when developing the next state budget.”
In his monthly newsletter, Don Klepper-Smith, chief economist and director of research for DataCore Partners, characterized the August numbers as “abysmal” and “far below expectations.”
After job gains in May and June, Klepper-Smith wrote, “We've now seen back-to-back job losses totaling 5,600 jobs and the labor markets are now headed in the wrong direction due to a host of factors. ... The aggregate data is now showing that the Connecticut economy is now ‘moving sideways’ more than anything else, while the risk of recession over the next 12 months is tangible and rising.”
He cited as factors “the combination of persistent budget problems at the state and local level, waning business confidence, multiple downgrades in the state's bond rating, a potential bankruptcy within the City of Hartford, and greater levels of overall economic uncertainty.”
Only one of the state’s six Labor Market Areas showed jobs gains in August: the Bridgeport-Stamford-Norwalk area. The Norwich-New London area lost 1,000 jobs during the month, but for the year remains the fastest-growing area in the state in percentage terms.
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