Connecticut Unemployment Claims Top 220,000

HARTFORD, CT — With 220,000 Connecticut residents filing unemployment claims Connecticut’s economy is headed, at least temporarily, on a downward trajectory.

An estimated 180,000 Connecticut residents filed unemployment claims last year, and 220,000 have filed them in the last 18 days, according to Gov. Ned Lamont.

Lamont said they are working to get more workers at the Department of Labor to process unemployment claims, but at the moment the backlog to receive benefits is five to six weeks.

“We’re doing everything we can to upgrade the system to make this expedited process work,” Lamont said.

Office of Policy and Management Secretary Melissa McCaw said they have created a SWAT team to explore all options, including bringing back retirees.

The loss of tax revenue from both income and sales tax will impact the state budget for years to come.

Lamont pegged this year’s budget deficit at around $500 million and next year’s could be as much as $1.4 billion based on preliminary estimates.

McCaw said if Connecticut was going to have a downturn similar to the Great Recession in 2008 and 2009 then the first year impact would be about $1.4 billion.

The state expects to receive $1.45 billion from the federal government, but it can only be used on COVID-19 related expenses. It can’t help replace revenue losses.

Lamont said 80 to 90% of the revenue loss will come from decreases in income and sales taxes as a result of the virus.

McCaw said it took the state four years to bring its revenue back from the Great Recession, and it took even longer to pay off the close to $1 billion in economic recovery notes it borrowed from the federal government.

“This is not your garden variety recession,” Lamont added.

Lamont said he’s done everything he could do to make sure small businesses are able to survive this “so if there is demand coming out of this medical shutdown we’re in position to take advantage of it.”

McCaw said she doesn’t believe there’s a need for any legislative action to close the budget deficit since the money will automatically come from the Rainy Day Fund if the state ends the year with a deficit.

The state Bond Commission will meet remotely next week to release funding to municipalities for things like local roads and other critical infrastructure.

Meanwhile, on Thursday another 267 people tested positive for COVID-19 bringing the total up to 3,824. More than 18,000 have been tested and 112 people have died.

Lamont also expects to sign his 21st executive order today which will prohibit short-term rentals and hotels from boarding anyone that’s not an essential worker.

“Not leisure travel, not vacationers,” Lamont said.