🔒Boosting advanced manufacturing, workforce development key 2023 priorities for lawmakers

In order for Connecticut’s advanced manufacturing industry to remain competitive, it must accelerate the use of 3D printing, broadly adopt big data and analytics, and embrace digital technologies such as Internet of Things, automation and extended reality.

And those efforts must be embraced by manufacturers of all sizes.

Those are the conclusions and recommendations of a recently published report from the state’s Manufacturing Technology Working Group, which was created by the state legislature in 2021 to develop a road map for in-state manufacturers to adopt Industry 4.0 technology.

Industry 4.0 refers to the ongoing direction of automation and data exchange in manufacturing technologies and it’s seen as the future of the industry, particularly for the types of high-skilled manufacturing work that Connecticut competes for.

“Some believe that the changes in workforce due to the adoption of Industry 4.0 will be monumental, much like the change to domestic work in the early 20th century,” the report said. “It is foundational that Connecticut has the workforce of the future to support a robust Industry 4.0 manufacturing ecosystem. … We need to recognize that the gaps in preparation of all participants in the workforce will deter successful adoption of Industry 4.0 technologies.”

The nearly 40-page report created by the working group — made up of policymakers, industry consultants and companies — could lead to new policy proposals this legislative session that support advanced manufacturing in the state, according to state Sen. Joan Hartley (D-Waterbury), who co-chairs the legislature’s Commerce Committee.

Hartley — a longtime state lawmaker who was reelected in November after running unopposed for her 15th District seat — recently spoke with the Hartford Business Journal about the Commerce Committee’s priorities for the 2023 legislative session.

She said she’s bullish on Connecticut’s economic prospects given the state’s newfound fiscal stability, and the fact that the pandemic made the state a more attractive place to live.

A big focus for the Commerce Committee, which primarily deals with bills that impact businesses and economic and workforce development, will be trying to capitalize on the state’s post-pandemic momentum, Hartley said.

Here’s what else she had to say. The Q&A has been edited for length and clarity.

Do you envision the Commerce Committee proposing bills this legislative session based off the recommendations and conclusions of the Manufacturing Technology Working Group’s recently released report?

A. I think very much we’ve got to keep this moving forward. The first step is to have the informational hearing, to get everybody acquainted with the report’s findings, and then focus on the big picture and determine the next steps.

This is not going to be a study that just sits on the shelf. That’s not what this is about at all.

What are the Commerce Committee’s other main priorities for the 2023 legislative session?

A. The Commerce Committee is all things business and we are focused on everything from the smallest micro businesses to our big guys in the aerospace and defense industry.

We’ve got our pain points in Connecticut, led by high energy costs, and we recognize that, but we also have our strengths like our skilled workforce, which we need to maintain.

There are some silver linings coming out of the pandemic and we have started and want to continue to capitalize on them. The pandemic really changed the world of work and business for everyone. You can now live in Madison or Old Lyme and work in New York or California, and that’s caused people living in some of our neighboring states to give Connecticut a real good second look.

I’ve seen it in my own community. I represent Waterbury, Middlebury and Naugatuck and the influx of metro New York folks and families has been exponential.

So, I think part of the job of the Commerce Committee is to try to capitalize on that.

You’ve got a great quality of life here. We’ve got a strong educational infrastructure.

The Transfer Act has been a major pain point in Connecticut. It’s been blamed for stifling property transactions and redevelopment opportunities. Policymakers and regulators have been designing a new, less burdensome “release-based” system to govern environmental cleanup and replace the Transfer Act.

Where are we in that process?

A. We’ve been working on reforming the Transfer Act for 24-plus months and we’re now at the point where we’re close to posting the new regulations.

That’s going to be a big change in the commercial and industrial sector for the state of Connecticut, because it’s going to take that bull’s-eye off our back. Right now it’s just us and New Jersey that have lived under the Transfer Act, which forces property owners to prove the negative when it comes to determining if hazardous wastes have been spilled on a property.

(The Hartford Business Journal reported in November that the new Transfer Act regulations are likely to be released this year and then put in force in 2024.)

Several business groups have been lobbying for an expansion of the R&D tax credit to pass-through entities in hopes it will spur innovation investment by smaller manufacturers and bioscience companies.

Will the Commerce Committee consider that bill?

A. We’ve actually tasked the Department of Economic and Community Development (DECD) to do some modeling on that to assess the impact, and we should be getting that information back soon.

We currently have the R&D tax credit available for C-corporations, but we’re hearing from a lot of entities, especially smaller bioscience companies, that this would be an incredible draw for pass-through entities as well.

We’ve asked DECD to model out what the revenue loss would be to the state and the overall impact it would have.

(DECD had not completed its analysis of expanding the R&D tax credit to pass-through entities as of Jan. 11, according to an agency spokesperson.)

What about the workforce shortage? Connecticut employers reported over 100,000 job openings throughout most of 2022. The state has allocated tens of millions of dollars for workforce development programs, including the $70-million CareerConneCT program, which offers free job training in high-demand industries and promises to graduate workers quickly for immediately available jobs.

Is there anything more the legislature needs to do to address the workforce shortage?

A. We know that Connecticut’s workforce has shrunk. It’s happened nationally as well. But women in the workforce have taken the biggest hit. Previously, they made up more than half of the workforce. They are well below that level now, and obviously COVID had a really big impact there.

Part of it was child care so we are looking at ways to try to incentivize to build that part of the workforce back up again.

You mentioned the state needs to broaden its apprenticeship programs. Can you elaborate on that?

A. I want to look at our apprenticeship programs because the world is changing. We have traditionally had apprenticeships in welding, plumbing and for electricians. Those are very important and we need to continue to grow those pipelines.

But we are in a different place right now with emerging industries and jobs, like mechatronics, (which are skills — including mechanics, electronics and computing — needed in the advanced automated manufacturing industry).

That’s a whole new sector and we should be building apprenticeships in those kinds of emerging fields and trades, including maybe software.

The Lamont administration’s Department of Economic and Community Development has shifted its incentives strategy, moving away from upfront grants and loans to businesses to a system that rewards certain companies with tax rebates after they’ve added at least 25 jobs.

Is that a policy you support?

A. It’s a totally new model, which I subscribe to, but we are going to look at the outcome and see how it is going.

The other big focus of mine has been supporting women- and minority-owned businesses. We have not been where we should, historically, on this, so we are going to continue to focus on how we can support them.

We’re operating in this world where we have really changed our fiscal profile, we are now recognized as one of the fiscally sound states. It gives us this opportunity to try to work on and invest in our priorities, but it’s got to be done very prudently, not just throwing money at things.

There’s a lot of vacant office space in Hartford and other major urban and even suburban centers. Does the state legislature have a role in helping cities and towns figure out what to do with vacant office space?

A. This is a big challenge and it is not off of our radar.

What has happened in some communities, like Hartford and Waterbury, they have taken (federal stimulus) money and used it to incentivize landlords in core business districts to fit out locations for new businesses, to attract feet on the street and try to bring back vibrancy into the downtown areas.

Having said that, there are other opportunities, so the Commerce Committee is going to try to identify, be supportive of, promote, and quite frankly, be the facilitator to come up with solutions.

But government can’t do everything (in terms of providing financial incentives). It’s always been my position that we can be the facilitator to help lay the groundwork.