Economic outlook for state in 2015: job creation and growth
The Connecticut economy picked up steam last year and is expected to do even better in 2015, according to a new economic projection by the Connecticut Center for Economic Analysis.
The Connecticut Economic Outlook, a publication of the University of Connecticut, pointed to “the nearly unprecedented creation of 25,000 new jobs in 2014” to argue that “Connecticut has been on what seems to be a powerful upward trajectory.”
The new report estimates that the state’s growth in economic output last year will be in the neighborhood of 5 percent. This year, according to forecasting models, that growth rate could hit 8 percent, while the outlook for next year is about a 3 percent expansion.
“We won’t believe it until we see it — it is hard to see where Connecticut has in place the spare capacity to deliver that level of growth,” the report said.
But it’s hard to argue against the notion that the state’s outlook has improved, the report said, thanks largely to public investments in bioscience and aerospace, including Gov. Dannel P. Malloy’s major initiative to bring The Jackson Laboratory to the state.
“Even if we got 5 to 6 percent growth (this year), that would be stunning,” said Fred Carstensen, director of the Center for Economic Analysis and co-author of the report, in a phone interview.
Under the Weicker, Rowland and Rell administrations, “We never really gave serious attention to economic development,” Carstensen said. “We really didn’t make much effort.”
Connecticut has been in a state of suspended animation for the past 25 years, Carstensen said, with no job growth in that time. During the Rell Administration, he added, the state suffered through a four-year recession that didn’t end until 2011 — two years after the rest of the country had begun to recover.
“We weren’t competitive for a long time,” Carstensen said.
The state didn’t invest much in infrastructure, he said, and it took a long time to connect educational institutions to the workforce needs of industry. Now, he added, Malloy has announced a major initiative to improve the state’s roads and bridges while also expanding the capability of advanced manufacturing training in Connecticut.
But while things are looking up now, he added, Connecticut cannot become complacent because many factors can affect the economy going forward, including projected state budget deficits of tens of millions of dollars.
“Serious government belt-tightening could severely damage Connecticut’s robust recovery and thwart its opportunity to finally experience sustained employment growth,” according to the report.
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