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Connecticut Economy: Another Round Of Un-Recovery

By MARA LEE

September 17, 2012

The next 18 months will be dismal, the executive editor of The Connecticut Economy predicts, headlining his forecast "another round of un-recovery."

This forecast is a sharp change of heart for Steve Lanza, who just three months ago projected the state would add jobs at a pace of about 12,000 between the summer of 2012 and the summer of 2013.

Now, he says, job growth is likely to be about half that by the summer of 2013. And a pace of 12,000 jobs a year wasn't that strong to begin with.

Lanza did write the forecast before the Federal Reserve decided to take more aggressive action to improve the housing market, and, officials there hope, lower unemployment.

The forecast said if the Fed's actions stimulate the economy, the state could add roughly 9,250 jobs over the next year.

The Connecticut Economy report, a publication of the University of Connecticut, did uncover some bright spots.

One article, about securities and hedge fund jobs in Fairfield County, showed how jobs in that sector have been growing, as finance jobs move out of New York City into Northern New Jersey and Southwest Connecticut.

In 1990, Southwest Connecticut had just 3 percent of the jobs in these fields; by 2007, it was 7.6 percent.

And while finance jobs were slashed during the recession, in 2010 and 2011, hiring in these fields in Fairfield County has been much faster than most of the jobs recovery in the state.

Over the last two years, the county added 1,377 securities and hedge fund jobs, a close to 8 percent growth rate, almost 10 times as fast as overall job growth.

They were about 43 percent of the 3,200 net new jobs in Fairfield County during that period.

Some of that growth is just because finance itself has benefited from Federal Reserve actions, and is finding it needs more people after cutting harshly in the financial collapse. But the article's author, Connecticut Department of Labor Senior Economist Dan Kennedy, said more than 500 of the jobs are because Fairfield County is more attractive to decision makers than New York and New Jersey.