Unhappy holidays: December job losses

Even the Christmas holidays couldn't brighten Connecticut's economic doldrums.

The latest statistics released Thursday by the state Department of Labor showed Connecticut losing 1,800 jobs in December, while the Norwich-New London region saw 400 fewer workers. December losses meant that local employers had 500 fewer jobs at the end of last year than they did in December 2011.

The December numbers capped a year in which Connecticut made no inroads in recovering jobs lost during the Great Recession.

The state, which has added only about 28,700 jobs since the recession ended three and a half years ago, has regained less than a quarter of the 117,500 positions that it lost during the downturn — half of the job recovery rate seen in the rest of the nation. Even under optimistic projections, Connecticut wouldn't make a full recovery until sometime in 2016, said Don Klepper-Smith, chief economist and director of research for New Haven-based DataCore Partners, in a note to clients.

"This is proof positive that Connecticut's job recovery continues to make only 'minimal' progress," Klepper-Smith said. "Our job growth is running about one-third to one-half of the growth that we've seen in prior upturns."

Peter Gioia, an economist and vice president of the Connecticut Business & Industry Association, said the state's loss of 100 jobs between the end of 2011 and December of last year shows an economy that is gaining no traction.

"It's really stuck in neutral," Gioia said in a statement.

"It is apparent that the rate of job growth slowed considerably in the last half of the year," agreed Andy Condon, director of research for the state Labor Department.

What's more, 9,900 workers in the state left the labor market in December, the second highest monthly decline in the civilian workforce since 1976 and the sixth consecutive month of significant reductions.

Gioia said people are leaving the labor force because they are discouraged about their job prospects. With fewer people looking for work, Connecticut's jobless rate fell three-tenths of a point to 8.6 percent in December.

Klepper-Smith noted that the "officially unemployed" rose by nearly 5,000 last year in Connecticut even as the labor force dropped by more than 45,000. He estimates that, taking into account discouraged workers, those who are only marginally employed and others forced into part-time work, the true unemployment rate last month in Connecticut was 14.4 percent.

Six of Connecticut's major job sources showed declines in December, while only three saw increases in the number of positions.

"The only bright lining in the report was the 800 jobs added in manufacturing and 500 in construction," economist Gioia said.

The Labor Department noted that the construction figures could have increased thanks in part to Superstorm Sandy cleanup work.

The report noted that four sectors — government, financial activities, manufacturing and construction and mining — have continued to lose jobs throughout the recovery. On the other hand, the education and health services sector has never lost jobs during the recovery period and has added 25,000 positions since February 2010.


Connecticut employment changes during December

Education and health services 1,800
Manufacturing 800
Construction 400

Trade, transportation, utilities 2,000
Professional and business services 1,400
Leisure and hospitality 1,000
Other services 200
Information 100

SOURCE: Connecticut Department of Labor


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