The Connecticut economy is expected to see positive but modest growth in 2022, coming out of a COVID-induced recession and into recovery.I’ve been analyzing Connecticut business cycles for over 40 years now and every one is unique. In my mind, what makes the current environment different from others is the degree to which “spin, partial […]
The Connecticut economy is expected to see positive but modest growth in 2022, coming out of a COVID-induced recession and into recovery.
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Don Klepper-Smith Chief Economist, Director of Research | DataCore Partners LLC
I’ve been analyzing Connecticut business cycles for over 40 years now and every one is unique. In my mind, what makes the current environment different from others is the degree to which “spin, partial truths, and misconceptions” are coloring the hard economic data.
Importantly, left unattended, these misperceptions often turn into “facts” in people’s minds. As a math-trained analyst, this overall level of misperception is unprecedented, and I’d say most people are generally unaware as to the true health of the Connecticut economy.
A case in point was the jobs data reported on by various media sources this past September. The headlines stated “Connecticut has recovered 7 in 10 jobs lost due to the pandemic” and gave the misimpression that we’re 70% of the way back to full job recovery. That’s simply not the case.
The lack of fiscal discipline at the state and local levels continues to be an issue. According to the “2021 Report on Business Climate by State” produced by the Tax Foundation, Connecticut’s business climate now ranks 47th in the U.S. and has consistently ranked in the bottom quintile for many years.
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State workers now make 40% more in wages and benefits relative to the private sector. High taxes, the high overall costs of living, and demographic shifts are factors that will continue to create challenges for the state.
