The Connecticut Business & Industry Association’s 2022 survey of businesses found that the state’s worker shortage is acute, quantifying anecdotal evidence that employers are struggling to find and retain workers.
The survey comes at a time when the state’s financial health is better than it has been in decades, but questions linger about how it will overcome systemic challenges including inflation, supply chain disruptions, the labor shortage and outdated infrastructure.
The study says there is “indisputable data that Connecticut is more susceptible than many states to these pressures.”
The survey found that 85% of employers reported difficulty finding and/or retaining employees, and 39% said the lack of skilled applicants was their greatest obstacle to growth.
Twenty-nine percent of employers made their greatest investment in employee retainment, up five percentage points from 2021.
Meanwhile, 34% of companies expected their workforce to grow in the next six months, one percentage point higher than last year.
Inflation, and the state’s relatively high cost of living, were top of mind for many of those surveyed.
A third of companies (33%) reported that the state’s high cost of living was the top concern for employees and their families.
Eighty-nine percent of business leaders thought the cost of doing business in Connecticut was increasing, while 50% said the state’s business climate was declining.
Just over two-thirds (68%) of companies reported profits in 2021, up from 64% in 2020. Fewer companies, 65%, expected to see profits in 2022, but just 9% forecasted losses, according to the survey.
The outlook for Connecticut was slightly better than for the nation as a whole. Only 26% of the businesses surveyed saw Connecticut’s economy growing in the next year, while 20% expected GDP growth for the U.S..
Forty-four percent of those surveyed expected sales to grow in 2022, up one percentage point from last year – the highest level since 2014.
Eighty-three percent of participants said they were impacted by supply chain disruptions, and more than half (56%) raised prices because of inflation.
Between February 2020 and August 2022, Connecticut’s labor force — the number of people working, plus those actively looking for work — shrunk 2.3% (down 45,100), accounting for 41% of the New England region’s losses, the survey found.
Connecticut’s GDP grew 4.2% in 2021, which was the 36th fastest in the country, but dropped in the first quarter of 2022, contracting 1.4% as companies struggled to meet demand for products and services amid the labor shortage and surge of the Omicron variant of COVID-19.
Click here to see the full survey results.