A new report found Connecticut’s economic growth is lagging, post-pandemic.

The data showed, using the pandemic-induced recession as a baseline, the state’s nonfarm employment has grown at a rate around 3% lower than the national average. It reported the decline is due in part to slow growth in local and state government jobs, which were down in Connecticut by 10.5% between 2007 and 2023.

Patrick O’Brien, research and policy director at Connecticut Voices for Children and the report’s author, described one reason state job growth has lagged behind the nation.

“Connecticut has a higher percentage of housing-cost-burdened households than the U.S. as a whole,” O’Brien reported. “Which suggests that our housing affordability problem is even higher than the U.S. as a whole, and that’s contributing to our slower growth problem.”

He cited other reasons, including the unaffordability of most basics needed for people to live in the state. One recommendation in the report is to increase the supply of housing to help bring prices down. A National Association of Realtors report found a family making $75,000 annually could only afford 23% of the homes for sale nationwide.

Connecticut’s gross domestic product growth lagged the U.S. by 7.5%. O’Brien noted it is an important factor because there are many long-term obligations for the state’s surplus funds. However, he pointed out there are other options the surplus funds could be used for.

“Increased investments in child care — in particular, we’ve been recommending a child tax credit,” O’Brien urged. “There are a whole range of progressive tax issues that would help to make the tax system fair. Add to that by making the property tax credit fully refundable, and available to renters.”

O’Brien hopes to see child care cost in the state go down, since it is one of the highest in the country. The Economic Policy Institute reported the average annual cost for infant care in Connecticut tops $15,000. Child care for a four-year-old is almost $13,000 per year.