The state is relatively well off but remains weak on job growth as AI exerts a major influence on the labor market, according to experts.
Connecticut is “the Switzerland of the U.S.” with its high income levels, low unemployment rate and globally competitive industries, but its job market is limited, particularly for college graduates, said Michael McDonald, associate professor of finance at Fairfield University.
“It’s very hard if you’re a young person to remain in Connecticut,” he said. “It tends to be a market and an area that is primarily appealing to affluent people who’ve already kind of achieved their initial level of success in their career.”
Connecticut’s unemployment rate was 3.8% at the end of August, according to the U.S. Bureau of Labor Statistics.
McDonald on Monday joined John Traynor, president of Cambridge Wealth Management Trust of Connecticut, for a discussion on “The State of the State” at the 15th annual economic forum held by the Connecticut chapters of the Turnaround Management Association, Association for Corporate Growth, Exit Planning Exchange and National Association of Corporate Directors. The event took place at Fairfield University’s Charles F. Dolan School of Business.
McDonald said the economy of the Northeast — including Connecticut — is “wobbling” amid persistent inflation and at risk of slipping into a recession, citing data from Moody’s.
However, he said business formation in Connecticut is rising faster than in neighboring states, partly due to post-pandemic migration that brought new capital and entrepreneurial talent into the state.
Traynor said AI is making the workforce more efficient, but Connecticut employers must keep adopting the technology to ensure those jobs stay in the state.
“The industries that are investing the most in AI right now are the knowledge industries,” he said. “We need to be ahead of the curve.”
Immigration will factor heavily into Connecticut’s workforce by 2030, in great part because the state’s population is declining, he said.
“Shutting the doors completely — whether it’s through H-1B visas or whatever it is — is not an option if you’re an employer here in the U.S.,” he said.
