Op-Ed: Connecticut is enjoying a sustained recovery
The report of 11,500 new jobs in Connecticut in September, the fastest rate of job creation in more than 20 years, startled some. Given the timing before the election, many might cynically discount the importance of such numbers.
But the jobs report, when combined with other data, confirms that Connecticut is now enjoying real recovery, from the doldrums of the Great Recession, and from a generation of failure to create jobs.
Previously available employment numbers, output data, and projections argued that Connecticut has been on a sustained, positive trajectory for nearly three years, since 2011. Growth from the end of 2011 through 2013 was second best in the Northeast, faster than growth 30 other states, and close to the national rate.
Economic forecasts from the Boston Federal Reserve and Moody’s Economy.Com –the New England Economic Project — anticipate strong growth in jobs through 2014, with stronger growth in 2015 and 2016, adding perhaps 80,000 new jobs.
Continuing growth in the national economy deserves some credit, but Connecticut’s economy contracted from 2007 to the end of 2011, a longer, deeper contraction than nearly any other state suffered. For a generation Connecticut inflicted on itself a trifecta of policy failures: failure to invest in infrastructure (including IT), failure to invest in human capital (the education-workforce pipeline as well as IP transfer), and absent or incoherent development policies.
The Malloy administration has addressed all three failures — how effectively and whether other approaches might have delivered more is an open question, but his administration shares credit for the strength of the sustained recovery. Many initiatives — Business Express, First Five, the UBS loan — focused on short-term job preservation and creation.
Other efforts took a longer view, looking to preserve core strengths or create new sectors and anchor companies or sectors in Connecticut. These included attracting NBC Sports to Stamford and supporting expansion of the ESPN Bristol campus. Both strengthen Connecticut’s footprint in digital technologies. The University of Connecticut’s new Department in digital technologies assures the trained workforce essential to these activities.
The UTC agreement, permitting UTC to use tax credits it earned to help fund a $450 million Pratt research campus, anchors all associated jobs and related value-chain activities in Connecticut (jobs can and often do move; the specialized research campus cannot be moved; jobs based there cannot be done without the building), preserving the state’s pre-eminence in aerospace engineering.
The attraction of the Jackson Laboratories human genome research facility vastly strengthened the BioScience initiative already underway at the University of Connecticut and provided the already powerful Yale-New Haven biomedical complex a valuable collaborator. Critically, JAX literally put Connecticut at the epicenter of global bioscience research.
With potential Nobel Laureate Dr. Charles Lee leading the JAX team, the new Farmington laboratory is rapidly filling; JAX is already talking of a second research building. That the Icahn School of Medicine is putting a major genome sequencing facility in Branford is proof of the growing strength of the biomedical cluster in Connecticut and presages significant future colocation effects.
What is unfolding in Connecticut is analogous to the history of North Carolina’s Research Triangle. NIH’s decision to put a national research laboratory there drove its success, a decision essentially identical to JAX coming to Farmington in terms of impact on industry awareness and driving colocation.
Nearly every biomedical company soon had facilities in the Triangle high tech companies quickly followed. The Triangle now hosts over 1,000 companies. Moreover, the Triangle is closely affiliated with UNC-Chapel Hill, NC State, and Duke. Thus investments in UConn through BioScience and NexGen parallel what helped drive success in the Triangle.
Combining the narrative of current initiatives and available data declares that Connecticut is now “bending the curve,” building economic vitality and growing competitiveness in critical, high value, expanding sectors, adding tens of thousands of new jobs within the next three years.
Fred V. Carstensen is a professor of finance and economics at the University of Connecticut and is director of the Connecticut Center for Economic Analysis.
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