The most tangible of Connecticut’s dismal economic indicators may be the new computer server and automated phone lines recently ordered for a beleaguered corner of the state bureaucracy – the unemployment office.

“It is simply overextended and overwhelmed by the load,” Gov. M. Jodi Rell said in January, answering complaints that the system has been unable to accommodate the newly unemployed. Connecticut has an 8.9 percent unemployment rate.”

The U.S. economy might be slowly recovering, but Connecticut has 155,000 residents receiving jobless benefits, with as many as 9,000 new claims coming in most weeks, Rell said.

With construction and manufacturing jobs hit the hardest, Senate Democrats have called on Rell to authorize $1 billion in borrowing for ready-to-go construction projects. But Rell has been trying to put the brakes on borrowing.

Unemployment benefits are available for 99 weeks. The state Department of Labor is experiencing record levels of residents filing for benefits, forcing the department to create jobs by hiring phone operators.

The demand for social services from the state has increased by nearly 20 percent in the past year. Almost a million people are enrolled in the various assistance programs; including 460,000 receiving medical assistance and 300,000 people receiving food stamps during November 2009.

One out of every 680 homes in Connecticut is in foreclosure, according to a firm tracking the trend, RealtyTrac. Personal bankruptcies in the state rose by 25 percent in 2009 over the previous year, the National Bankruptcy Research Center said.

Connecticut has one of the slowest growth rates in the country of its gross domestic product, a key measure of economic output.

Many predict the worst is still to come. The University of Connecticut’s economic analysis warns job losses will continue for the next two years, even if the national economy recovers.

The state’s own budget crisis could exacerbate unemployment, since every billion dollars cut in spending could equate to the loss of an additional 18,000 jobs, the report warns.

The state’s ability to respond is limited because of it’s own fiscal crisis.

A legislative committee report suggests reinvesting in specific industries and creating a tax credit to private investors who invest in small and start-up industries. A state agency’s proposal aims to review the state’s tax structure and foster development.

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