Located between two of the world’s most influential and powerful cities, Hartford has long felt like the forgotten sibling battling for attention.
But for almost a quarter of Connecticut executives, the proximity to Boston and New York City is a huge benefit of doing business in the state.
Speaking Out
That intriguing factoid is one of many found in the 2007 Survey of Connecticut Businesses, conducted by the Connecticut Business & Industry Association and Blum Shapiro. A total of 967 Connecticut executives took part and responded to a multitude of questions ranging from their profitability to their biggest challenges.
In addition to its location near those two major cities, 37 percent of executives cited Connecticut’s high quality of life and 17 percent cited personal satisfaction as why the state is good for business.
Steven Lanza, the executive editor of The Connecticut Economy for the University of Connecticut, said in the survey that the state’s strategic location and proximity to markets and suppliers have led to profits “despite significant concerns about the cost of doing business.”
In fact, 70 percent of executives said they expect to be profitable in 2007 with an additional 24 percent who believe they will at least break even.
A positive attitude will only take a business so far and executives are less than optimistic about the future. Only 37 percent said current conditions for their companies were good or excellent, a sharp drop from the 51 percent who believed that a year ago.
Concerns
Indeed, one day before CBIA released its findings, the Federal Reserve Board said businesses in Connecticut and the rest of New England are growing increasingly uncertain about the outlook for the economy. In its quarterly “Beige Book” analysis, it said credit problems have many companies uneasy, as do problems of hiring qualified workers in the area.
That was echoed less than 24 hours later. CBIA reported that two of the major concerns are the rising cost of doing business in Connecticut and the apparently imminent depletion of the workforce.
More than two-thirds of the executives said they are worried about cost, with health care benefits singled out as the greatest concern.
The pressure on Connecticut’s business community, say executives, is compounded by burdensome taxes for which they believe they receive a low value. Businesses want to see the state be more aggressive in reducing costs by either reducing taxes, improving infrastructure, improving the state’s regulatory climate or encourage more investment.
“Over the last year, the state and federal economies have continued to send mixed signals on what direction they are headed,” said CBIA economist Peter Gioia in the survey. “The latest survey provides some positive findings…despite Connecticut’s high business costs, which are making it more difficult for our businesses to add jobs.”
Health Issues
While health care is the most pressing issue at present, many executives expect workforce issues to come to the fore in the not-too-distant future.
When asked about hiring, 66 percent said their company is having difficulty attracting qualified employees. Asked why, 76 percent pointed to not enough qualified applicants in the job market, 58 percent said the cost of living was too high and 35 percent blamed the applicants’ lack of job-readiness.
“As the baby boomer generation begins to reach retirement age, the need to attract and retain younger, qualified workers to the state will become of utmost importance to the state’s future success,” said CBIA research economist Jason Giulietti.
