In 2016, Connecticut lost 200 jobs, according to revised numbers released Friday by the Connecticut Labor Department.
At least one economist called the news “hugely disappointing.”
Peter Gioia, an economist with the Connecticut Business and Industry Association, said Connecticut was the only state in New England that didn’t add jobs in 2016.
Massachusetts added 56,000 jobs in 2016, or 1.6 percent growth, while New Hampshire saw 1.8 percent growth. The United States saw 1.6 percent job growth in 2016.
It had been expected that Connecticut would add about 12,000 jobs in 2016, which means the economy is even weaker than economists initially thought.
Every March, the Connecticut Labor Department provides unemployment insurance claims information to the U.S. Bureau of Labor Statistics to help reconcile the monthly job estimates for the previous year. The annual revision has shown varying degrees of error in the monthly estimates from the U.S. Department of Labor’s Bureau of Labor Statistics (BLS), as compared to the revised numbers released each year in March. The BLS estimates reported monthly are based on a sampling process, according to Andy Condon, Director of the Office of Research.
According to CTNewsJunkie’s analysis of the employment data, the employment figures reported each month based on sampling during 2016 were overestimated by an average of 5,425 jobs per month.
This is an improvement, with respect to accuracy, over 2015. During that year, the DOL’s monthly sampling figures overestimated state employment by a monthly average of 19,342 jobs. The overestimation was lower for 2014, during which the average was 3,500 higher than the revised figures released the following March.
In 2013, the BLS underestimated job numbers by an average of 5,433 per month.
“The annual benchmark revision process indicates we saw fairly strong job growth in the first quarter of 2016, followed by a sharp decline in the second quarter,” Condon said. “Third quarter job growth was modest while the fourth quarter was slightly down, ending the year essentially flat.”
The government sector, which includes all federal, state and local employment, including public higher education and casinos located on tribal land, was the largest contributor to job losses in 2016, according to the department.
Don Klepper-Smith, an economist with DataCore Partners, said Connecticut is still 30,000 jobs from attaining full job recovery, and is not likely to see full job recovery until sometime in 2019 at the current pace.
“Odds are we’ll see a full-blown domestic recession before then, which implies that the job high of 1,713,300 set in March 2008 isn’t likely to be reached anytime soon,” Klepper-Smith said in his analysis.
He said Connecticut’s labor markets are “clearly underperforming” because the annual growth rate over the last 30 years has been about 1.2 percent annually.
The national labor market has recovered about 184 percent of the jobs lost in the Great Recession, but Connecticut has over the past seven years has recovered less than half that amount.
“Think about that for a moment!” Klepper-Smith said.
But 2017 got off to a good start.
In January 2017, Connecticut gained 5,700 jobs, according to the Labor Department.
Klepper-Smith said he is predicting modest expansion of Connecticut economy heading into 2017, but he also warned that the state faces major challenges in the year ahead.
Connecticut’s unemployment rate for January increased slightly by one tenth of a point to 4.5 percent, which is a full percentage point lower than it was a year ago. That’s lower than the national average of 4.7 percent.
Senate Republican President Len Fasano, R-North Haven, said the numbers are “truly pathetic.”
“For the past six years, under one-party Democratic rule, record tax hikes and job-killing policies have only fostered unpredictability and instability,” Fasano said. “We’re literally going backwards now.”
Gov. Dannel P. Malloy said the state has recovered about 80,000 jobs since the end of the Great Recession.
He admitted that job growth was relatively flat in 2016, but January’s report was “broadly good news.”
He said he doesn’t “bake a cake over” the monthly numbers, but is encouraged.
A Malloy spokeswoman pointed out that that “the revised numbers reflect a leaner government and growing private sector.” Private sector employment was up 5,400 jobs over 2016, while the government sector was down 4,400.
