When Lego announced in late January that they would be relocating their corporate headquarters out of Enfield to Boston, it felt like yet another body blow to Connecticut’s fragile economy and even more fragile self-esteem. It’s hard when companies leave, especially when they take high-paying corporate jobs with them. But what does Lego leaving actually mean for us, and what lessons, if any, can we take away from this?
Lego first came to Enfield in 1975, when they built a manufacturing and distribution center on Moody Road. Over time, the Danish company added on to its complex in Enfield, eventually placing its North American headquarters at the plant in 1995. That made sense, as the company wanted to have everything in one place.
However, Lego decided to move brick molding out of North America in 2000, reducing the Enfield plant to distribution only. The distribution center closed in 2007, leaving only the corporate headquarters. Lego doesn’t even own the building anymore, they lease the space from Winstanley Enterprises.
Last year, Lego announced plans to build a new North American factory – but in Virginia, not Connecticut. Boston was already home to Lego’s education center, and they have a partnership with MIT, so moving out of Connecticut to the Hub also makes a certain amount of sense. Indeed, as Gov. Lamont reiterated in a statement, the move was more about what Boston had to offer instead of what Connecticut lacked.
That doesn’t make it any easier. Lego’s sudden announcement, which came as a complete surprise to officials in Enfield and Hartford, feels like a repudiation. Or, to put it another way, we got dumped. Ugh.
Of course, in the days and weeks to come, we’re going to look in the mirror and ask: could we have prevented this? What’s so bad about Connecticut that we can’t keep a company like Lego from leaving?
Sen. John Kissel, R-Enfield, said that the state needs to make itself more affordable and appealing to businesses. But what does that mean, in practice? If we’re talking about real estate, Enfield is still one of the cheapest towns around here to live in. According to Realtor.com, the median listing price for a home in Enfield in December, 2022, was a little under $250k. That won’t even buy you a lean-to in a garbage dump in Boston.
And if we’re talking tax incentives, well, Enfield and other towns have a long history of handing them out. Enfield’s town council recently gave Winstanley Enterprises a 30% tax assessment reduction over seven years for their massive new distribution center on North Maple Street. Lego, on the other hand, never gave any hints that it was thinking of moving, and so the state and the town had no chance to try and convince them to stay. Sure, we could have been more proactive. But this feels like the kind of decision Lego was going to make no matter what.
Business organizations often talk about cutting taxes, but it’s not like income and sales taxes are much better in Massachusetts, and corporate taxes are actually a little higher. Still, now that Connecticut’s financial situation has gone from the decade-long fiscal crisis of the 2010s to stable with surpluses, we can think about making some tax cuts. In fact, Gov. Lamont is proposing doing just that.
But the biggest issue is one we can’t solve. When GE left Fairfield, they moved to Boston (though it ended badly for them). When Aetna threatened to leave, they wanted to go to New York City. Companies in the 2020s are looking for two things when it comes to a location for their corporate headquarters: a highly educated population, and a huge, thriving city. We have one of those.
But the other, the big city, is something we have never had, and something we likely never will have. We can do a lot to make our current cities better places to live and work, but Bridgeport can’t be New York, and Hartford can’t be Boston.
It often feels like we get the short end of the stick when times change. Connecticut used to be full of farmland, but when territories in the more fertile midwest opened up, people left to go there. Then we were a manufacturing powerhouse, one of the finest in the world. But when globalization made it possible for companies to make products in other states and other countries for a fraction of what it cost here, all that disappeared. What remains are old stone walls in the middle of forests, and empty brick mills beside still ponds and freely rushing streams. And now that the era of big suburban office parks is ending, those will go away too.
But each time history knocks us for a loop, we get back up and reinvent ourselves. The Yankee spirit of innovation, born of living in a hard, rocky land, is still alive. The best thing we can do is encourage the businesses and industries that are here, like high-tech manufacturing, logistics, and bioscience, and give them what they need to grow and be successful. We can make Connecticut a more affordable place to live, and an easier place to get around in. We can deepen those links to the big cities that bookend us.
What we can’t, and shouldn’t, do is fall into the trap of despair. Yes, it’s awful when a big, iconic company like Lego leaves. But the sun will rise tomorrow.
As for Enfield, Winstanley is already on the lookout for another tenant for the space Lego will vacate. It’s a fine building in an excellent location for lots of different kinds of companies. And there are plans to turn an office park that was once the home of MassMutual into a sports complex.
Don’t count Connecticut out.
