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An Old, Feeble Future

Exodus Of Young Workers Draining State Of Its Vitality

By DAVID FINK

January 20, 2008

Imagine Connecticut is a family. Mom and Dad both need to work, but one gets laid off at just the time Grandpa moves in.

Much higher expenses. Much less income.

That's what's about to happen to our state.

In its annual report to the legislature in December, Gov. M. Jodi Rell's budget office warned that unless we make quick changes, Connecticut as we know it will disappear within two decades simply because young adults are vanishing from Connecticut and the rest of the state is getting very old.

How will we pay the bills? We won't.

Housing policy wonks like me say, simply, build more housing that workers and young families can afford. We don't have much now and, unlike virtually every other state in the nation, prices in Connecticut aren't falling. Starter homes and rentals they can afford will keep young people and jobs here.

The Office of Policy and Management report predicts that between now and 2030, Connecticut's population will grow 8.3 percent, less than a third of the nation's projected 29.2 percent growth. We probably will lose another congressional seat and the related federal aid, but that is the least of it.

Only the 65 and older group will grow — by 70 percent! The number of 18- to 64-year-olds will decline slightly, 0- to 17-year-olds more. Our children will leave and our labor shortage will deepen while our need for expensive services for the elderly will explode.

The number of workers for each resident over 65 will shrivel from 4.5 to 2.6. Tax revenues needed to support an aging population also will shrivel. There will be little for health care, education, local aid — you name it.

Who will want to live in a Connecticut like that?

Not me. You?

Connecticut has already lost a higher percentage of 25- to 34-year-olds since 1990 than any other state. Young adults consider many factors when picking a place to live. The largest cost in that calculus is a home — and Connecticut's home costs have risen 70 percent since 2000. Even as home prices fell virtually everywhere else in 2007, they still inched up here, by 1 percent through November.

The problem: not enough supply. Connecticut was 49th last year, and 46th since 2000, in homes built per capita.

We must build starter homes and affordable rentals to solve the population problem and hold onto workers, young professionals and families who will do the jobs and pay the taxes we will need. Otherwise, if businesses can't find workers, they will leave, too. Then we'll be worse off than even the OPM report predicts.

Already, the state's businesses are having an awful time finding workers. When Pfizer looked to relocate research and development workers from Michigan to Connecticut last year, home prices made it impractical for many workers.

Meanwhile, municipalities can't find road workers, teachers or volunteer firefighters. Guilford is the latest town considering a fully paid fire department — at considerable expense — because there is little housing for the young workers who typically volunteer as firefighters. Essex First Selectman Phil Miller told me, "It seems like all of our teachers are living with their parents in Glastonbury."

And with 43 percent of Connecticut teachers now over 50 and planning to retire in the next 10 to 15 years, where will towns find replacements if they can't afford to live here?

The loss of younger residents affects towns in other ways. The Connecticut Conference of Municipalities says towns are having a harder time passing budgets. Many first selectmen agree that the middle class, young and middle-age residents who typically vote "yes" to support town services can't afford to live in town.

Towns such as Simsbury are thinking of building more housing in their centers because they need workers, teachers and housing options for young adults. They also sorely need more customers to support their merchants. Additionally, density in the right place offers more property tax revenue.

Those who need the most help are feeling it most. The number of households making 80 percent of the state's median income or less, and spending 30 percent or more of that income on housing, has shot up to 26 percent from 19 percent two years ago. They are the people we also need the most — auto mechanics, hairdressers, health care workers, sales clerks. Can they leave for less costly housing in other states? Sure.

The good news: Creating the homes we need is doable — using such tools as the recently enacted HOMEConnecticut law, which provides incentives to municipalities that create mixed-income housing options.

Housing construction and occupation is a proven font of sales and income taxes from construction jobs and building materials and, later, from home furnishings and the jobs that will result from the new homes.

Connecticut's economy and fiscal future are tied to population and job growth. We can't have either unless we have homes people can afford. Either we create the homes and welcome the workers and tax revenues we need, or we let our workers and the Connecticut we love disappear.

David Fink is policy director for the Partnership for Strong Communities.