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Connecticut’s job growth crisis: An interview with State Rep. Richard A. Smith

Connecticut State Representative Richard A. Smith
Connecticut State Representative Richard A. Smith Contributed Photo

(Part 1 of 2) “State posts sixth straight month of nonfarm job gains; unemployment rate falls to 6.6%” is the latest headline from the Connecticut Department of Labor, Office of Research’s Labor Situation report.

In the July Jobs Report recently released, Governor Dannel P. Malloy declares, “this latest report is yet another sign that we are making steady progress in improving Connecticut’s economy.”

At first glance, this news about the unemployment rate being down one-tenth of a percentage point in July, when compared to June, seems positive. However, Connecticut State Representative Richard A. Smith of the 108th District who represents New Fairfield, Sherman, New Milford, and Danbury thinks otherwise.

As Ranking Member of the Labor and Public Employees Committee, Richard offers unique insight regarding the somber unemployment situation and the lack of substantial job growth in the State of Connecticut.

In an exclusive interview, State Representative Richard Smith believes Connecticut’s real unemployment rate is more like 8.97 percent, the economy is in-fact failing miserably, and the state is actually in job growth crisis mode.

Do you think Connecticut is finally recovering from the recession?

No. We are no better now than we were four years ago, and we continue to set policies that move the State in the wrong direction. Taxes, on every level, are still outrageously high. So many people are still out of work, and they will continue to look for and find jobs elsewhere, unless Connecticut provides a favorable climate for job creation.

Regarding the latest unemployment number reported, what are your thoughts?

An improvement of one-tenth of a percentage point is nothing to get excited about because the report creates a false-sense of economic recovery.

The real unemployment rate in Connecticut is more like 8.97 percent if the unemployed workers who are no longer collecting and just gave up looking are actually included.

To get to this number I looked at December 2010, the month before Governor Malloy took office. This is when the labor force hit its peak at 1,917,300. Since then, the labor force has declined almost every month.

Today, the labor force stands at 1,872,200, including those employed and those looking for work. This is 45,100 less than in December 2010. It is widely believed that those 45,100 people are also unemployed but have stopped looking for work. If you add them to the reported unemployment number, the unemployment rate in Connecticut increases to 8.97 percent.

How long do you think it will take to recover?

In theory, and at this rate, it will take us over three-and-a-half years more just to recover from all of the jobs lost.

Doing the math, I simply used the numbers provided by the Connecticut Department of Labor in their July Labor Situation report. Basically, we need to recover 68,600 jobs to have a fully restored workforce. We have been restoring 1,625 jobs, on average, per month. Clearly it will take some time at the rate we are going.

Since March of 2008, the beginning of the recession, what is the grand total and breakdown of jobs lost versus jobs gained?

There is no central source that reports both the number of jobs lost and the number of jobs gained. The Department of Labor reports survey numbers only, which theoretically represent a net number – jobs gained minus jobs lost. According to data from the Department of Labor, there are 22,400 fewer people employed today than there were in March 2008. There are 29,200 more people unemployed than there were in March 2008.

In addition, average weekly earnings in the private sector when Malloy took office were $954.72. The August Labor Situation Report shows weekly earnings at $940.99. The average worker is actually making less today than almost four years.

One of the things about the earnings numbers is that a lot of the new jobs are part-time jobs, which would at least partially explain the decreased earnings. Part-time jobs are also included in the job creation and unemployment rate numbers that Malloy cites.

What are a few more of the main reasons why you believe Connecticut’s economy is in turmoil?

For starters, Connecticut is in extremely poor economic condition. The Office of Fiscal Analysis, a non-partisan independent agency, is reporting over a projected $3 billion dollar deficit that we are inheriting next year.

Secondly, the #1 Employer in the State of Connecticut is the Connecticut Government. This is not a good indicator of a healthy, diverse and growing economy.

According to a recent report from the Office of Fiscal Analysis, there are 61,349 full-time state employees, which make up about 3.6 percent of the total Connecticut workforce.

And, according to the Department of Labor, there are approximately 1.7 million people employed in Connecticut.

As a comparison, and as far as I can tell, the next largest employer in the State of Connecticut is Sikorsky, with approximately 11,000 employees.

(Part two of this exclusive interview with State Representative Richard A. Smith will be about what he thinks it will take to improve the dismal Connecticut economy.)

For more in-depth reading, see State Representative Richard A. Smith’s recent article:

OPINION: Economic outlook still bleak in Connecticut

See also Alicia’s related article:

Connecticut’s startups, expansions and layoffs announced in August