Connecticut lost 900 construction jobs in September — a time when the industry normally ramps up employment to finish outstanding projects before winter.
That September loss, which at -1.5% ranked among the worst of any state, followed a year in which Connecticut’s construction employment grew just 0.5%, slower than 41 other states, according to state labor statistics and a leading trade group.
The head of Connecticut’s chief lobbying group for the construction industry said that problem isn’t likely to change until state officials can figure out how to accelerate the rebuild of Connecticut’s aging transportation infrastructure.
When “you have lost 900 jobs right around when you’re moving from prime construction season into crunch time, it’s an indication we could be doing better,” said Donald Shubert, president of the Connecticut Construction Industry Association. “It doesn’t have to be this way.”
Construction sector employment dropped from 61,600 jobs in August to 60,700 in September, according to the Department of Labor. That’s only the second time in the past decade that construction employment here fell in September — the other happening in 2016, labor records show.
According to the Associated General Contractors of America — an Arlington, Va.-based trade association representing thousands of general and specialty contractors and suppliers — Connecticut’s 1.5% drop in September ranked 48th among 50 states in terms of construction job growth.
The contractors association also noted that Connecticut’s 0.5% construction job growth over the past 12 months, from 60,400 jobs to 60,700, ranked 42nd among all states.
Both construction industries and construction trades have been urging Gov. Ned Lamont’s administration to go accelerate the state’s transportation capital program, a challenge that has stymied several governors.
Chris DiPentima, president and CEO of the Connecticut Business and Industry Association, said construction firms here have been struggling to fill vacant jobs. But he also said more robust state investments in transportation work is key to revitalizing the industry.
“They [state officials] need to get the work out into the streets and put the pressure on the construction industry, the private sector, to find those jobs,” he said.
“There is ample evidence that job growth would be even stronger if this industry could find all the workers it needs,” said Patrick Flaherty, director of research for the Connecticut Department of Labor, adding that there are more than 1,200 jobs currently posted for construction workers. Flaherty also said other sectors also are struggling to recruit workers.
Both Lamont and state Department of Transportation Commissioner Garrett Eucalitto said earlier this month the administration is working to add engineers and other professionals needed to launch more projects.
Eucalitto said the DOT has about 3,100 employees, roughly 200 more than it did in January.
But the administration also recently confirmed it has scaled back significantly its financing plans this fiscal year for highway, bridge and rail upgrades.
Connecticut borrows hundreds of millions of dollars annually for capital work by selling bonds on Wall Street, pairing those funds with hundreds of millions more in matching federal grants. The state then pays off the debt through the state budget’s Special Transportation Fund, which gets the bulk of its revenues from fuel and sales tax receipts.
The administration recently said it plans to borrow $875 million for transportation projects this fiscal year. That’s a 5.4% increase from the $830 million borrowed last year, but well below the $1 billion target it set last November for the 2023-24 fiscal year. And it’s far too little for construction firms and trades that argue Connecticut should be borrowing closer to $1.5 billion annually to upgrade an infrastructure largely built in the 1950s.
Because borrowing hasn’t risen sharply, the Special Transportation Fund has been running huge surpluses. The STF closed last fiscal year with a 15% surplus, equal to $277 million, according to final numbers from the state comptroller’s office. And that was despite a 13-month gasoline tax holiday that returned about $330 million to motorists. Most of that loss, $240 million, occurred during the 2022-23 fiscal year.
The fund is on pace for a $204 million surplus this fiscal year, a 10% cushion, according to Lamont’s budget office.
All of this black ink has Connecticut gasoline station owners, fuel distributors and others pressuring Lamont and lawmakers to cut gasoline taxes, arguing they aren’t being channeled into highway repairs anyway.
In other words — use them or lose them.
The stakes in this debate also are huge for two other reasons.
The massive five-year $1.2 trillion federal infrastructure program launched in 2022 is entering its third year. Federal grants are covering 80% to 90% of the cost of many state transportation projects, meaning the more states commit, the more overall funding they can leverage.
And both DiPentima and University of Connecticut economist Fred Carstensen said investments in construction could pay huge dividends for the overall state economy.
Construction permits are being issued here at roughly one-quarter of the pace they were 40 years ago, and since the 1980s, the state’s net economic growth has been minimal, said Carstensen, who heads the the Connecticut Center for Economic Analysis.
Construction projects tend to have a strong job multiplier effect, he said, noting they typically use primarily local labor and local suppliers, adding, “You don’t input concrete from Pennsylvania.”
A 2013 analysis from the center found that for every $1 billion in bonding Connecticut actually spends on capital projects translates roughly into 10,000 construction and related jobs.