10 Charts that Explain Connecticut’s Economic Recovery

Back • January 13, 2016 • Uncategorized

Connecticut’s recovery from the Great Recession has created winners and losers, with significant disparities that can be tracked by geography, race, industry and age. The charts below provide the top line news culled from our 2015 State of Working Connecticut report (some charts are updated to reflect newly available data).

For more on these trends, read the full report here and RSVP to our 15th Annual Budget Forum, where we’ll take a deeper dive on the recovery’s effect on these disparities.

1. Total Number of Jobs in Connecticut Fewer Than Before the Great Recession.
While the total number of jobs in the United States rebounded to pre-recession levels over 18 months ago, Connecticut continues to fall short, with nearly 20,000 fewer jobs in September 2015 than in December 2007. Since the state recently recovered all of the private sector jobs lost in the recession, this difference results from lower public sector employment levels.

2. And Those Jobs That Are Coming Back are Concentrated in Low-Wage Industries
Of the state’s eight largest industries, only three have the same number of jobs, or more, than they had when the recession began – professional services, health care & social assistance, and accommodation & food services.

3. Unemployment Declines Mirror Region and Nation
In September 2015, unemployment in Connecticut and the average unemployment rate in neighboring states was 5.2%, higher than the national rate of 5.1%, and just above pre-Recession levels, when it fell below 5%. But that’s not the full story; nearly 40% of the unemployed have been unemployed for over six months – a higher share than in previous downturns and ninth highest in the nation.

4. But, Unemployment Varies Widely by Place
For example the rate is significantly higher in the cities of New Haven, Waterbury, Bridgeport, and Hartford than in the state as a whole.

5. …and  Unemployment Varies Widely by Race
Before the recession, the unemployment rate for black and Hispanic workers exceeded that of white residents by nearly five percentage points. But that gap’s grown during the recovery: for example, unemployment for black residents (13.1%) is now more than double the rate for white residents (5.1%).

6. As Low-Wage Industries Dominate Recovery, Wages Continue to Decline
Not unlike the national recovery, wage growth in Connecticut has stagnated or tumbled (a challenge for workers and state budgets alike). Since 2009, Connecticut’s median wage dropped $2.50, or 11.1%, compared to a 5.3 % drop in neighboring states and a 4.0 % drop nationally.

7. …Even Though Nutmeggers Work Harder than Before
While state productivity grew by 111.3% from 1979 to 2013, the median hourly wage increased just 22.7% over that time. Had Connecticut’s wage growth kept pace with productivity, the average worker would enjoy a median hourly wage of $35.24 in 2013.

8. Workers of Color and Ethnicity Experience Enormous Wage Gaps
When the recovery began in 2009, white workers made 40% more than Hispanic workers and 38% more than black workers. Six years later, white workers make 59% more than Hispanic workers and 37% more than black workers. Assuming full-time year-round work, that’s $16,764 less per year for Hispanic workers and $15,100 less for black workers – the equivalent of the annual cost of high-quality childcare. 

9.  Gap Widens Between the Highest and Lowest Earners
Between 1979 and 2014, wages for workers at the top 10% soared by 45% while workers at the bottom 10 percent saw their inflation adjusted wages fall by $0.26 per hour.

10. Health of Labor Force is Cause for Optimism Looking Forward
The prime age employment-to-population ratio measures the portion of workers from ages 25 to 54 who are employed. Following a recession-led decline, recent data show a sharp uptick – a positive sign when assessing economic recovery.

Fortunately, Connecticut is well equipped to tackle the challenges described here. As the state’s economy begins to pick up steam, ensuring shared prosperity requires state investment in human capital, such as high-quality education for all children and youth, from cradle to career, stronger tax credits for low-income working families and families with dependents, and property tax reform to address geographic resource disparities that threaten school quality and other local services.