UConn, Fairfield U Economists: CT Outpaces Nation, But Big Dropoff In 2012
November 19, 2011
Despite the fact that the unemployment rate in Connecticut has barely budged — going from 9.1 percent to 8.9 percent over the last 18 months — the state's economic growth will finish 2011 slightly ahead of the national rate, University of Connecticut forecasters say.
They expect that when the figures are in for 2011, the state will have grown by 2.6 percent, as the nation grew by 1.9 percent.
In a forecast released Friday, economists at UConn's Connecticut Center for Economic Analysis predicted growth will be more sluggish in 2012, at just 0.9 percent — but employers in the state will add a predicted about 10,000 jobs. By comparison, the forecast for full-year job growth in 2011 is 6,000.
A separate forecast by Fairfield University Economist Ed Deak, for the New England Economic Partnership, also released Friday, predicts a gain of 10,400 jobs in 2011, but a loss of 6,400 jobs in 2012. He projects that unemployment will stay near 9 percent in both 2012 and 2013, and will be 7.7 percent in 2015, far higher than pre-recession levels.
Both forecasts say 2010 — when the economy gained 13,600 jobs — will have been the best of three post-recession years, for job gains. But even that was not robust, as a good year for Connecticut is considered to be a net gain of at least 1 percent, or about 16,000 jobs.
From March 2008 to January 2010, the state shed 119,200 jobs, Department of Labor figures show.
The authors of the report say that the construction of the biosciences complex at University of Connecticut, the Jackson Laboratories building, and the expansion of UConn's medical and dental schools account for 30 percent of their forecast for next year.
"Developing the biosciences cluster, with the twin anchors of the UConn health complex and Jackson Laboratories, establishes a leading-edge industry that is expected to contribute to the health and wealth of Americans for generations to come," the report said. "The health complex can deliver strong growth to the state for two decades or more."
The center is headed by economist Fred V. Carstensen, a leading proponent of the health center expansion because, he has argued, it builds on a key industry in a targeted way.
The forecast says manufacturing employment is not expected to continue to grow because global competition constrains export growth in existing markets.
Some business owners in the aerospace industry are saying that increased production of the F135 engine for the Joint Strike Fighter aircraft, and the PurePower, geared turbofan engine for commercial aircraft, will lead to hiring by Pratt & Whitney and at their own companies.
Carstensen said: "We know there are good things that are happening that we cannot include. Our forecast itself is more pessimistic than my broader judgment of what's going on."
Reprinted with permission of the Hartford Courant.
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