News item: Connecticut businesses closed in record numbers during the past quarter.
That headline certainly could have been from last week, when Secretary of the State Susan Bysiewicz announced that Connecticut businesses are continuing to close in record numbers, with 2,601 filing papers to dissolve in the three months ended Sept. 30.
It also could have been from April 3, 2008, when the numbers were different but closing still hit a quarterly record.
It could have been from Jan. 28 of this year; or from April 20; or from July 20.
You see, Connecticut businesses have been reaching quarterly records in closures for a long time now.
The news about the latest business-stops numbers came a day after the state labor department revealed Connecticut lost 6,600 jobs in September, pushing its unemployment rate to 8.4 percent.
Bysiewicz did have some good news to share with state residents last week. Third-quarter business failures fell 25 percent from the second quarter.
Meanwhile, 6,624 new businesses incorporated in the third quarter, an increase of 2.4 percent from startups in the year-ago third quarter, she said.
“I see some reason for optimism in the fact that we had more new businesses starting up in Connecticut last quarter than we did a year ago and the number of business shut downs dropped sharply from the second quarter to the third quarter of this year,” Bysiewicz said. “Our economy is recovering slowly, but this is obviously still a very challenging climate for any business trying to succeed.’’
Overall, Connecticut has seen 20,494 new business starts for the first nine months of this year, a decrease of 5.8 percent from 2008 figures.
The number of business closings from July 1 through Sept. 30 brings this year’s total to 9,545 — a record for the first nine months of any year since closures were first recorded in 2000.
Despite those discouraging figures, the state’s elected officials fumble around in the dark with no clear plan to address the steady drumbeat of business closings.
The state needs to bring business groups, labor interests and other private-sector experts to the table to develop a plan to address business attraction and retention.
It should start by taking a real look at the plan put forth by MetroHartford Alliance and other local chambers of commerce.
The chambers advocate establishment of a blue-ribbon panel of 15 individuals from a cross section of the private and public sector and labor to present policymakers with a list of recommendations.
The plan includes:
• The establishment of a dedicated revenue source (e.g. a percentage of the sales tax) to fund state and municipal pension obligations;
• A moratorium on all unfunded mandates that the state imposes on municipalities and a subsequent evaluation to determine which ones to reinstitute;
• The option for the state and municipalities to contract with private entities to provide services to the indigent, the elderly, and those with special needs.
It’s clear that the first priority in the upcoming legislative session should be addressing how to improve the state’s business climate. If not, the headlines will continue to look a lot alike.
