CT Unemployment Falls to 8.7% in October But 2012 Looks Worse
November 21, 2011
Unemployment in Connecticut fell to 8.7 percent in October, a level not seen since September 2009, the state Department of Labor said today.
The report also said state employers added 6,500 jobs in October, a preliminary figure that's subject to revisions.
Based on October's preliminary total, the number of jobs in Connecticut has grown by 8,800 in 2010, a slower rate than the same period last year, when employers added 12,300 positions.
October's decline in the jobless rate, from 8.9 percent in September, marks the third straight month of declines, since it was at 9.1 percent in July. But on the same day when Sikorsky Aircraft announced another round of job cuts, and the Congressional deficit supercommittee failed in its mission to cut federal spending, experts cautioned that the declines might not last.
"It would be very difficult to say that that trend is underway," said Fairfield University economist Edward J. Deak. "There are just so many issues at the macro level….and then you start looking at that list of headwinds and tailwinds, and it looks problemmatic for Connecticut."
The categories that showed the strongest job growth in October — construction, temporary employment and building services — "seem to be related to demand for repairs driven by Hurricane Irene," said Andy Condon, director of research for the state Department of Labor. "We would expect this type of job growth to be temporary."
Deak said the gains related to the storms, including a likely repeat in November, count as real economic activity even if they're temporary. The fear, he said, is that families will now cut back on their spending, starting with Christmas and continuing into 2012.
And, Deak said, heading into 2012, "You have a questionable cash flow coming out of the financial services sector."
Deak's forecast, released Friday by the New England Economic Partnership, calls for a decline of 6,000 jobs in the state in 2012, which would be especially grim considering the gains recorded this year and in 2010 still leave Connecticut far behind where it was before the job declines started in March of 2008.
The state had 1,627,600 jobs in October, according to Monday's report, which was based on a survey of employers and adjusted to reduce seasonal variations. That's up by 10,100 from October 2010, a tepid growth rate.
The 8.7 percent jobless rate reflects 163,900 people out of work and actively looking for jobs, according to a separate survey of households, also seasonally adjusted.
Reprinted with permission of the Hartford Courant.
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