The state Labor Department threw some cold water Thursday on Connecticut’s optimistic job outlook.

The department not only reported a 6,000-job decline in August, but scaled back the 11,500-job gain it announced in July by more than 16 percent.

Despite the job losses, Connecticut’s unemployment rate remained unchanged in August at 8.1 percent. That’s because the number of people actively seeking employment also fell last month.

A 7,500-position decline in government-sector jobs in August, particularly in education, drove the latest job loss totals.

“As suspected, the very high June and July education numbers were driven by a seasonal adjustment process that was confused by the late-closing (2012-13) school year,” said Andy Condon, director of the labor department’s Office of Research. “The August numbers corrected that pattern.”

Some prominent Connecticut economists had predicted one month ago that the July job growth totals would be scaled back.

Don Klepper-Smith, a veteran economist with DataCore Partners of New Haven, noted that for the 11,500-jobs-grown figure to be correct, Connecticut would have to have created 7 percent of all jobs in the U.S. in July.

Klepper-Smith, who was chief economic adviser to Malloy’s Republican predecessor, Gov. M. Jodi Rell, called that an unbelievable statistic given that Connecticut comprises just 1 percent of the national workforce and had finished last in business productivity last year.

Three of the state’s six labor markets lost jobs in August. Greater Hartford saw the biggest decline, down 2,500 jobs, while markets centered on Bridgeport and New London also lost ground.

The Danbury market was unchanged in August, while New Haven and Waterbury posted small gains.

Despite the reductions in publicly funded jobs, “Connecticut continued to see growth in the private sector in August, particularly in the goods-producing industry super-sectors including construction/mining and manufacturing,” Condon said.

The Nutmeg State has regained about 14,300 jobs so far this calendar year, compared with the meager 7,500 jobs it gained during the first eight months of 2012.

Connecticut’s unemployment rate is down slightly, about 0.5 of 1 percentage point, from where it stood one year ago.

Overall, the state has recovered just over 51 percent of the jobs — 62,200 out of 121,200 — that it lost in the last recession, which ended in February 2010.

Peter Gioia, chief economist for the Connecticut Business & Industry Association, said Thursday that the underlying message in the August report “was more positive than (the overall numbers) would imply,” given the growth in construction and manufacturing.  

“Unfortunately, we do still see weakness in financial services,” Gioia added, “and that’s a concern going forward. But overall, we’ve added 14,300 jobs since the beginning of 2013. That’s a positive sign. I think overall we’re going to continue on a positive rate.”

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

Leave a comment