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Connecticut DOL Labor Shows Smaller Firms Lost Proportionately More Employees in the COVID-19 Pandemic

  • Data from the Connecticut Department of Labor shows an annual drop of 9.9 percent in the state’s workforce between Q2 2019 and Q2 2020
  • Smaller businesses lost proportionately more employees than larger ones due to the impact of COVID-19
  • However, Connecticut’s small business losses were also less pronounced compared to neighboring states

Summary by Dirk Langeveld

Connecticut’s smaller employers lost proportionately more of their workforce than larger firms, according to data recently published by the Connecticut Department of Labor. However, the loss of small business workers was less pronounced compared to neighboring states.

In its latest issue of the Connecticut Economic Digest, the department breaks down Longitudinal Employer-Household Dynamics data from the U.S. Census Bureau. This data was available through the second quarter of 2020, encompassing the worst economic impact of the COVID-19 pandemic.

Between the second quarter of 2019 and the second quarter of 2020, Connecticut’s workforce shrank by 141,818 workers, or 9.9 percent. Firms with zero to 19 employees lost 36,053 workers, an annual loss of 13.5 percent, while those with 20-49 employees lost 29,934, a loss of 15.9 percent.

By comparison, firms with 50-249 lost 10.3 percent of their workforce, those with 250-499 employees lost 9 percent, and those with 500 or more workers lost 7.3 percent.

  • Connecticut lost proportionately fewer small business employees compared to Massachusetts, New York, and Rhode Island; however, losses were steeper at larger firms
  • Just over half of the jobs lost in Connecticut due to the pandemic were in accommodation and food services, other services, and retail
  • The report says that the industries that have been hardest hit by the pandemic have also had the swiftest recovery, raising the potential for jobs recovery to proceed more rapidly at smaller companies than larger ones
  • About 1.2 million people live and work in Connecticut, with another 140,500 who live in Connecticut but work out of state and 110,500 who live out of state and work in Connecticut

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