HARTFORD, CT — A new report released Tuesday by Connecticut Voices for Children argues that providing fairer wages for employees is the key to fixing the state’s sluggish job growth since the pandemic.
Titled “The State of Working Connecticut”, the 47-page report focuses on the state’s lower-than-average job growth in the past three years, when compared to the rest of the United States. It makes the case that wages need to be improved to grow Connecticut’s economy and provide tax revenue for the state, which is still facing long-term pension liabilities and cuts to key federal programs and funding sources by the Trump administration.
“Fairer wages, combined with greater work flexibility, improve the financial return to work and make it easier to balance paid employment with caregiving responsibilities,” the report states. “This is especially important for prime-age individuals and women, who are more likely to manage caregiving and weigh the financial and time tradeoffs between paid work and unpaid care.”
According to the report, Connecticut experienced 1.1% job growth from February 2020 through January 2025, compared to the national average of 4.4%. That works out to nearly 57,000 fewer jobs than if the state had kept pace. The report states that a major factor in Connecticut’s slow job growth is the state’s slow labor force growth. For the same time period, the state experienced 1.2% labor force growth, compared to the national average of 3.8%, which equals nearly 50,000 fewer potential workers.
Patrick O’Brien, research and policy director at Connecticut Voices for Children and the author of the report, said in a call that a decrease in the labor force among prime age individuals (people between the ages of 25-54) who are most likely to be raising families, and a decrease in the labor force among women, who are disproportionately responsible for caregiving, are the main drivers behind the stagnant labor force growth.
From 2019 through 2024, the number of prime age individuals in the state’s work force decreased by 1%, while nationally the number rose by 3.2%. Similarly, the percentage of women in the labor force decreased by 0.1%, while nationally the number of women working rose by 3%.
“To reverse these trends, and in turn support stronger job growth and broader economic growth it’s necessary for Connecticut to become a more affordable and accommodating place for families to live and work,” he said. “That certainly requires addressing major expenses such as housing and child care which have been the focus of other reports. However, it also requires increasing wages and improving work flexibility to strengthen the financial return to work and make it easier to balance paid employment with caregiving.
Wage growth and inequality was also addressed in the report. From 2021 through 2024, most Americans experienced real wage growth, while most Connecticut workers experienced a decline in real wages. However, this is not the case for all Connecticut employees, many of whom benefit from what O’Brien called a “wage premium”, based on education, experience, usual hours worked, union coverage, and job sector, industry, and occupation.
These employees inflate prices and drive up costs for middle and low-income earners, who often face wage gaps driven by gender, racial and ethnic disparities, he said. For example, the national gender wage gap finds women earning 15 cents less on the dollar than their male counterparts. That gap is exacerbated in Connecticut, where women earn 17 cents less. African American and Hispanic workers also face racial wage gaps that are larger in Connecticut than the national average, according to the report.
The report ends with recommendations to improve wage fairness, including indexing the state income tax to inflation; hiring more auditors at the Department of Revenue Services to capture missing revenue from non-wage earnings; limiting the use of noncomplete clauses to empower employees to bargain more effectively; increasing the salary threshold for where salaried employees are considered exempt from overtime earnings; and establishing predictable scheduling protections for hourly workers.
Emily Byrne, president and CEO of Connecticut Voices for Children, said the recently passed taxing and spending legislation, along with large tariffs and the administration’s mass deportation agenda, would have significant impacts on the economy.
“We’re starting to see early adverse economic signs already as the changes to Medicaid, [the Supplemental Nutrition Assistance Program], and higher education from the congressional megabills start trickling down and life becomes less affordable as a result,” she said. “A number of residents will be impacted, especially low and middle income families. And so the state will not only need to determine how to minimize harm and increase affordability for residents, it will need to do even more to promote economic growth.”