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Connecticut Gained 13,600 Jobs in 2010, More Than Double The Amount Originally Reported

Mara Lee

March 10, 2011

Connecticut's economy gained 13,600 jobs in 2010, a new report showed, more than twice the increase that earlier monthly surveys had suggested.

And because of a quirk in the numbers — there was a big decline in jobs between December 2009 and January 2010 — the year-over-year comparison looks even stronger, with 22,000 more jobs in January 2011 than a year earlier.

That's the good news. The bad news is that the recession was much worse than previously thought — 16,000 lost jobs worse, according to data released Wednesday by the state Department of Labor.

From March 2008 to January 2010, the state shed 119,200 jobs, and unemployment peaked at 9.2 percent, just 0.2 percent lower than the highest Connecticut unemployment on record, in January 1976.

Also Wednesday, the Labor Department said that the unemployment rate remained unchanged at 9 percent in January and that employers shed 2,700 jobs during the month.

The state's unemployment rate has been at 9 percent or higher for 14 months now.

Why did the unemployment rate barely budge in a full year if the state added 22,000 jobs? A small part of the answer is that more people decided to look for jobs, and in so doing they became officially unemployed.

But it's possible that the unemployment rate isn't as high as it appears because the data come from two different surveys, and the one that the jobless rate is based on isn't considered as reliable as the larger employer payroll survey, according to economist Nick Perna.

"I wouldn't be at all surprised to see a drop in the unemployment rate in the not-too-distant future, a half a point," to 8.5 percent, Perna said.

Also, when people who live in neighboring states come to work in Connecticut, that adds to our job totals but it helps those other states' unemployment rates, not Connecticut's.

That's what happened for Laura Mecham, who left Mass Mutual in Springfield in September 2009 during a restructuring. She had been with the company for almost 27 years, most recently in information technology.

"I sat back and read Jodi Picoult books for a bit, and after I sort of decompressed for a month or so, my goal was to get into the nonprofit sector," said Mecham, 52, of Wilbraham, Mass. "I do feel fortunate, because I wasn't in desperate shape," she said — her husband was still working.

Taking on volunteer roles, she joined the board of a nonprofit group in western Massachusetts and the fundraising arm of a Springfield nonprofit hospital.

Mecham expected that she'd take a 50 percent pay cut once she joined the staff of a nonprofit group, maybe in marketing, and expected it would take six months to find a job like that.

Instead, she was out of work for 14 months, and returned to insurance. She was hired at CIGNA in Bloomfield in December, and is working for a woman she had worked with at Mass Mutual years earlier, who reached out to her when she heard she had lost her job.

"Connecticut was the place to be, that's where all the insurance companies are," Mecham said.

This recession has been marked by much longer average lengths of unemployment than all other recessions in the past 50 years. Tens of thousands of Connecticut residents have been without work for more than a year and a half, disproportionately downsized from the manufacturing, construction and administrative and support fields.

Mecham also interviewed with several other Connecticut insurers, all by networking with former co-workers.

Because companies were flooded with applicants through online listings, Mecham found that sending her resume into the void was ineffective. Instead, when she spotted a job she was interested in, she'd let a former colleague at that company know, and that person would make sure that human resources saw her resume.

Her insurance company interviews were in the second half of the year, as momentum in the economy picked up.

Based on Wednesday's revisions to earlier data, which are based on a detailed look at payroll data rather than monthly surveys, the job growth in 2010 was as strong as it had been in 2007 — and only one other year in the decade had more hiring. But with 175,000 people out of work and actively looking, it would take more than three years of growth at almost twice this pace to get down to normal unemployment levels.

"Connecticut has considerably more recent momentum than we thought, towards the end of last year," said Perna, who lectures at Yale and consults for Webster Bank.

Perna did caution: "It's not always the case that momentum begets momentum."

He's not worried about the reported loss of 2,700 jobs in January because the snowstorms hurt hiring. But the increase in gas prices could be a drag on the economy if it lasts all year, he said.

"I think this is especially a lesson for the state budget right now," he said. "There are those who would love to be able to say, 'Well, growth is going to bail us out, revenues are going to rise very rapidly.' I think it's far too premature to reach that conclusion."

Like many people who returned to work, Mecham took a substantial pay cut. Her salary is 15 percent lower than her previous job, and when you combine salary and bonus potential, it's closer to a 30 percent drop.

Driving an hour to work instead of 20 minutes is not fun, but she bought a Mini Cooper Countryman to ease the pain, and she can telecommute one day a week, with the possibility of two days in the future.

She said as she interviewed for jobs, she heard concerns, "either that I would be too expensive, or I wouldn't be comfortable taking a position that wasn't the same caliber as what I had in the past."

But she told them that because she had planned to go into nonprofits, she was prepared to make less money.

"Money was not my motivator. My motivator was to enjoy what I do, make a difference in the lives of people, and that my work was appreciated," she said. At CIGNA, she's found all three, working in Wellness and Onsite Healthcare product marketing.

Even though Mecham's layoff was not a major financial hardship for her family, she is mindful that there are many people still struggling in this recession. "I do have friends, one in particular, he is still out of work, and it will be two years in April," she said. "He's got young kids, that's tough. He was also at Mass Mutual."