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Connecticut Unemployment Inches Down as Private Sector Hiring Improves

  • Connecticut unemployment shows little change in January in the latest data from the state Department of Labor
  • Private payrolls increase slightly, with trade, transportation, and utilities seeing the strongest gains
  • Information sectors has seen most significant losses during the COVID-19 pandemic

Summary by Dirk Langeveld

Connecticut’s unemployment rate stood at 8.1 percent in January, inching down 0.1 percent from December. Jobs figures showed little change, with a modest increase in private sector positions as well as a small decrease in government jobs.

The unemployment rate for the month was higher than the national rate of 6.3 percent, but down 3.3 points from its peak during the COVID-19 pandemic. Connecticut Department of Labor officials said the state’s labor recovery was proceeding well before an increase in COVID-19 infections in the autumn forced the state to tighten its business restrictions.

However, Connecticut Department of Labor Commissioner Kurt Westby said Connecticut’s labor force is “well-positioned to recover” once COVID-19 vaccines are widely distributed. Patrick Flaherty, acting director of research with the Connecticut DOL, says the data also shows pent-up demand in several sectors, with thousands of employers looking to hire.

Payroll employment was essentially unchanged in January, with a net loss of 100 positions. This was the third consecutive month of job losses, following a revised decrease of 4,600 job losses in December.

Private sector employment saw a gain of 400 positions, which was offset by a loss of 500 jobs in the government supersector. This includes federal, state, and local jobs, inclusive of education and tribal casino positions.

Overall, the state was down 127,300 positions compared to January 2020 and had recovered 57 percent of the 292,400 nonfarm jobs lost in March and April of last year at the start of the pandemic. Private sector positions in Connecticut were down 111,700 compared to the previous year, while government jobs were down 15,600.

The trade, transportation, and utilities sector added 2,400 jobs in January and had recovered 94 percent of the jobs lost in the pandemic. The education and health services sector added 1,200 jobs and was at 82 percent of its pre-pandemic employment.

The information sector has suffered the brunt of job losses in Connecticut, shedding 1,400 positions in January; the sector has 29 percent fewer jobs than it did before the pandemic. The construction and mining and professional and business services sectors each saw a drop of 700 jobs in January.

The Waterbury and Bridgeport-Stamford-Norwalk labor market areas saw job gains, while the remaining labor market areas in Connecticut posted losses. The average worker in January had a 34.2-hour work week and earned $34.23 an hour.

The Connecticut Business & Industry Association said the state’s recovery is in line with that of other New England states as well as the United States as a whole, which has recovered 58 percent of the jobs lost in the pandemic. The organization said the figures show that economic recovery should remain a priority for the state legislature.

“The revised 2020 employment numbers are a sobering reminder of just how fragile our state’s economic recovery is,” CBIA president and CEO Chris DiPentima said.

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