Connecticut’s latest jobs report is giving cause for concern.
The state generated far fewer jobs last year than first thought. And it may reveal one reason that Connecticut is unexpectedly struggling with income tax revenues that fail to meet its forecasts.
The monthly report just released shows Connecticut added 900 jobs in January, and the state’s unemployment rate ticked upward by one-tenth of one percent to 5.5 percent. A much more worrying statistic, though, came with the revision of annual totals that’s always undertaken in March.
Previous estimates, taken from monthly samples, had indicated that Connecticut added 26,900 jobs in 2015. This revision, which reflects actual payroll data, slashes that by more than half. In fact, the state added 12,200 jobs last year.
Governor Dannel Malloy used the figures to emphasize his new message about readjusting expectations. "While the numbers demonstrate progress," said the governor in a statement, "they are also emblematic of our new economic reality."
The CBIA’s Peter Gioia said the figures are worrying.
"I think that this shows that the economy has some challenges with it," he said. "Yes, we are growing, but we're growing at perhaps a slower pace than we had anticipated or hoped for."
Independent economist Don Klepper Smith, of Datacore Partners in New Haven, said the numbers mean Connecticut still stands at less than 75 percent of full jobs recovery from the great recession. He said he has now readjusted his forecasts, and no longer believes the state will achieve a full jobs recovery this year.
Andy Condon, Director of the Office of Research at the Connecticut Department of Labor, said such a massive variation between monthly sampling data and the final revision is extremely rare, but it does happen; he could recall only one other time in his career when he's seen that kind of statistical anomaly. "These samples were clearly at one end of the bell curve," he said.
