ECONOMIC DIGEST THE CONNECTICUT. Connecticut s Economy: A Look Back...and Ahead JANUARY In November... January 2005

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1 THE CONNECTICUT ECONOMIC DIGEST Vol.10 No.1 A joint publication of the Connecticut Department of Labor & the Connecticut Department of Economic and Community Development JANUARY 2005 IN THIS ISSUE... Connecticut s Economy: A Look Back...and Ahead ,5 Occupation Profile: Recreation and Fitness Workers... 3 Housing Update... 5 Economic Indicators of Employment... 4 on the Overall Economy... 5 Individual Data Items Comparative Regional Data... 9 Economic Indicator Trends Business & Economic News Labor Market Areas: Nonfarm Employment Labor Force Hours and Earnings Housing Permits Cities and Towns: Labor Force Housing Permits Technical Notes At a Glance Connecticut s Economy: A Look Back...and Ahead By Mark Prisloe, Associate Economist, DECD I raq, energy prices, jobs, a polarizing election, and higher interest rates dominated the economic scene in This article explores their impact and takes a look at what these and other indicators mean for Risks for 2005 The year 2004 brought us an escalation in the war in Iraq, continued threat of terrorist attacks, enormous increases in the price of crude oil, sharp increases in producer prices, a ballooning federal budget deficit, minimal job growth, and a hard fought presidential election and a polarized electorate. On the positive side, the U.S. economy continued to expand and productivity continued to increase. As the war in Iraq persists, the cost will continue to rise putting further strain on the federal budget and severely limiting any future economic stimulus options. The continuing stand off between the U.S. and North Korea, as well as the emerging Iranian nuclear threat, will perpetuate uncertainty in the marketplace. Over the long run such uncertainty weakens consumer confidence. Energy prices also became a renewed economic threat in With crude oil prices at unprecedented highs, the costs of air transportation, trucking, and gasoline at the pump gobbled increasing shares of business and consumer budgets, at least restraining--if not choking off-- further economic expansion. In November... Nonfarm Employment Connecticut... 1,646,700 Change over month % Change over year % United States ,075,000 Change over month % Change over year % Unemployment Rate Connecticut % United States % Consumer Price Index United States Change over year % Thousands Connecticut Nonfarm Employment, Forecast Forecast Source: Connecticut Department of Labor Forecast

2 THE CONNECTICUT ECONOMIC DIGEST The Connecticut Economic Digest is published monthly by the Connecticut Department of Labor, Office of Research and the Connecticut Department of Economic and Community Development, Compliance Office and Planning/Program Support. Its purpose is to regularly provide users with a comprehensive source for the most current, upto-date data available on the workforce and economy of the state, within perspectives of the region and nation. The annual subscription is $50. Send subscription requests to: The Connecticut Economic Digest, Connecticut Department of Labor, Office of Research, 200 Folly Brook Boulevard, Wethersfield, CT Make checks payable to the Connecticut Department of Labor. Back issues are $4 per copy. The Digest can be accessed free of charge from the DOL Web site. Articles from The Connecticut Economic Digest may be reprinted if the source is credited. Please send copies of the reprinted material to the Managing Editor. The views expressed by the authors are theirs alone and may not reflect those of the DOL or DECD. Contributing Staff: Rob Damroth (CCT), Cynthia L. DeLisa, Salvatore DiPillo, Lincoln S. Dyer, Arthur Famiglietti, Daniel W. Kennedy, Ph.D., David F. Post, Mark Prisloe (DECD), Joseph Slepski, Mark Stankiewicz and Kolie Sun (DECD). Managing Editor: Jungmin Charles Joo. We would also like to thank our associates at the Connecticut Center for Economic Analysis, University of Connecticut, for their contributions to the Digest. Connecticut Department of Labor Shaun B. Cashman, Commissioner Thomas E. Hutton, Deputy Commissioner Roger F. Therrien, Director Office of Research 200 Folly Brook Boulevard Wethersfield, CT Phone: (860) Fax: (860) dol.econdigest@po.state.ct.us Website: Connecticut Department of Economic and Community Development James F. Abromaitis, Commissioner Ronald Angelo, Deputy Commissioner Jennifer Smith Turner, Deputy Commissioner Compliance Office and Planning/Program Support 505 Hudson Street Hartford, CT Phone: (860) Fax: (860) decd@po.state.ct.us Website: With the manufacturing production index already down by 4.6 percent, it remains to be seen just how severe this threat will become, but it is definitely an issue that bears watching as a downside risk. Other global issues also make up the international backdrop. China s seemingly insatiable demand for raw materials will continue to put upward pressure on producer prices. U.S.-China relations are sure to become a major issue in 2005 as the trade balance between the two countries has dramatically risen over the past few years to almost $150 billion annually. This, too, will put a drag on economic growth in 2005 and beyond. Although the consensus is that the U.S. and Connecticut economies are enjoying a slow economic recovery, the question entering 2005 remains, Where are the jobs? One of the most hotly debated issues in the presidential race was the pace of U.S. job growth. Data from the U.S. Bureau of Labor Statistics show that from December 2000, just before Bush took office, to December 2003, the U.S. lost 2,406,000 jobs. However, the same source also shows that just before the election, the U.S. had regained 1,982,000 jobs from its December 2003 level. Employment Connecticut s job picture seesawed between gains of more than 4,000 jobs in both April and May 2004 to losses of the same magnitude in both June and July When the final data are in for 2004, it is likely Connecticut s employment in 2004 will barely have changed at all from 2003 s estimated level of 1,644,000, leaving Connecticut employment still below the pre-2001 recession level. Even though overall Connecticut employment has stabilized, employment growth continues to elude most industry sectors here in the State. Productivity, Connecticut s leading competitive advantage, cuts both ways. While it increases the output of employed workers, employers can produce more with the same or fewer workers. This phenomenon will persist in the year ahead and continue the trend of slow job growth even as the economy expands. Further exacerbating the employment problem is the slow growth in the Connecticut labor force worsened when discouraged workers leave the pool of eligible job seekers. Connecticut s employment probably won t surpass the 2000 high of million until Interest Rates Continued lackluster job growth isn t our only worry for 2005 as the specter of inflation is once again lurking in the periphery. Higher producer prices, especially coupled with increasing energy costs, portend higher consumer prices down the road. However, the Fed has already begun raising interest rates and will likely continue to do so in increments of 25 basis points at each Federal Open Market Committee meeting, hopefully holding inflation at bay until neutral rates are achieved. Rising interest rates and construction costs should begin to dampen the U.S. and Connecticut housing markets; however Connecticut s housing market should continue to show strong results. At last report, year-to-date data for housing permits were up an impressive 21.0 percent to 8,797 units, on track to surpass 2003 s high of 10,435 units. However, construction contracts, a standard measure of building activity, were down on a year-over-year basis by 8.8 percent. Despite higher interest rates, we should expect another solid year of housing growth in Connecticut in 2005 because housing demand is also driven by prices, incomes, --Continued on page 5-- l 2 THE CONNECTICUT ECONOMIC DIGEST

3 OCCUPATION PROFILE By Cynthia L. DeLisa, Research Analyst, DOL RECREATION AND FITNESS WORKERS What does the fitness industry have to offer? It is really hard to find a job you love to be at every day. Having a fitness related career is exciting! You get to interact with many people, and receive satisfaction from helping people make positive changes to their lives and helping them achieve their personal best. ~ Mark, Personal Trainer Newington, CT Overview People spend much of their leisure time participating in a wide variety of organized fitness related activities, such as aerobics, weight training, and sports. Fitness workers plan, organize, and direct these activities in community centers, fitness centers, and tourist destinations (i.e. cruise ships, spas and resorts). Increasingly, fitness workers also are found in workplaces, where they organize and direct fitness activities and athletic programs for employees of all ages. Persons planning fitness careers should be outgoing, good at motivating people, and sensitive to the needs of others. Excellent health and physical fitness are required due to the physical nature of the job. Average Annual Wage for Fitness Workers by Selected Labor Market Area, 2003 Bridgeport Stamford Statewide New Haven Hartford Danbury New London Waterbury Job Descriptions Fitness trainers and instructors lead or coach groups or individuals in various exercise activities. Fitness trainers help clients to assess their level of physical fitness and help them to set and reach fitness goals. They also demonstrate various exercises and help clients to improve their exercise techniques, as well as keep records of their clients exercise sessions in order to assess their progress towards physical fitness. Personal trainers work with clients on a one-on-one basis in either a gym or the client s home. Aerobic instructors conduct group exercise sessions that involve aerobic exercise, stretching, and muscle conditioning. Fitness directors oversee the operations of a health club or fitness center. Training, Other Qualifications, and Advancement Generally, fitness trainers and aerobics instructors must receive a certification in the fitness field to obtain employment. Certification may be offered in various areas of exercise such as personal training, weight training, and aerobics. Certification generally is good for 2 years, after which workers must become recertified. Most fitness workers are also required to maintain a cardiopulmonary resuscitation (CPR) and first aid certification. There are $23,240 $22,675 $37,365 $35,765 $34,370 $39,820 $48,420 $54,540 $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 many organizations that offer certification testing in the fitness field, some of which are listed in the Sources of Additional Information section at the end of this article. College courses in management, business administration, accounting, and personnel management are helpful for advancement to supervisory or managerial jobs in a health club or fitness center. Some fitness workers go into business for themselves and open up their own fitness centers. Employment Outlook and Average Wages Overall employment for fitness trainers and instructors is expected to grow faster than the average for all occupations through 2012 as an increasing number of people spend more time and money on personal training, aerobic instruction, fitness and leisure services. Also, more public and private businesses are joining the fitness trend, recognizing the benefits of recreation and fitness programs as well as other wellness programs. Fitness trainers and aerobic instructors in Connecticut earned an average hourly and annual salary of $19.15 and $39,820, respectively, in 2003 (see chart). Earnings higher than the statewide average are generally found in the southwestern areas of the State. Note: Earnings of successful self-employed personal trainers can be substantially higher. Connecticut s current and projected employment figures indicate that in 2000 there were approximately 4,720 fitness trainers and aerobics instructors employed in the State, with projected employment of 5,670 in That s a 20% increase! At the national level, fitness trainers and aerobic instructors earned approximately $9,200 less per year than their peers in Connecticut, with an average annual and hourly salary of $30,590 and $14.71, respectively. Current and projected employment figures indicate that in 2002 there were approximately 182,720 fitness workers employed in the U.S., and projected employment of 263,947 (44.4% increase) in n Sources of Additional Information Ø American College of Sports Medicine (ACSM) Ø American Council on Exercise (ACE) Ø Aerobics and Fitness Association of America (AFAA) THE CONNECTICUT ECONOMIC DIGEST l 3

4 EMPLOYMENT INDICATORS LEADING INDEX COINCIDENT INDEX P e a k 0 4 / P e a k 1 2 / 6 9 P e a k 0 5 / 7 4 P e a k 0 3 / 8 0 T r o u g h 0 1 / 8 3 T r o u g h 0 2 / T r o u g h 1 0 / 7 1 T r o u g h 1 1 / The distance from peak to trough, indicated by the shaded areas, measures the duration of an employment cycle recession. The vertical scale in both charts is an index with 1992=100. Encouraging News This Month May Not Add Up to Much For the Year A s expected, at its last meeting on December 14, 2004, the FOMC raised the Federal Funds rate by another 25 basis point to 2.25 percent. The major news in the last month has been the U.S. fiscal and current account deficits and the sliding value of the U.S. dollar against major foreign currencies. As is frequently the case in economics, there are at least two sides to a story and unfortunately, there is not enough space here for me to present a balanced discussion of these important and interesting issues. Suffice it to say here that the fiscal and current account deficits, as a fraction of real gross domestic product, are not out-of-line with historical norm. Thus, at least for the immediate future, these deficits are not likely to present a major difficulty for the U.S. economy, but the current account deficit is likely to slow the growth of the U.S. economy slightly as we substitute foreign for domestically produced goods. Also, so far the depreciating U.S. dollar in the currency market appears to be a self-correcting mechanism to the imbalance in the U.S. current account and does not signal a loss of confidence in the U.S. economy by foreigners. The two employment indices provide us with some encouraging signs in October. The revised CCEA-ECRI Connecticut coincident employment index rose on a year-to-year basis from in October 2003 to in October All four components of this index are positive contributors, with a lower insured unemployment rate, a lower total unemployment rate, higher total non-farm employment, and higher total employment. On a sequential month-to-month basis, the revised CCEA-ECRI Connecticut coincident employment index rose slightly from in September 2004 to in October 2004, driven solely by a fall in total unemployment rate from 4.7% to 4.6% in October. The three negative contributors are a slightly higher insured unemployment rate, a small decrease in total nonfarm employment, and lower total employment. The revised CCEA-ECRI Connecticut leading employment index also provided us with encouraging news. It rose from in October 2003 to in October Five components of this index are positive contributors, with a lower Moody s Baa corporate bond yield, lower initial claims for unemployment insurance, a lower short duration (less than 15 weeks) unemployment rate, a higher Hartford help-wanted advertising index, and higher average weekly hours worked in manufacturing and construction. A drop in the number of total housing permits is the only negative contributor. On a sequential month-to-month basis, the revised CCEA-ECRI Connecticut leading employment index rose from in September to in October A lower Moody s Baa corporate bond yield, lower initial claims for unemployment insurance, a higher Hartford helpwanted advertising index and higher average weekly hours worked in manufacturing and construction are the four positive contributors. Lower total housing permits, and a higher short duration (less than 15 weeks) unemployment rate are the two negative contributors to this index. With two more months to go before the end of the reporting year, the Connecticut economy is showing no definite pattern. For most of this year thus far, the Connecticut economy has taken a series of side-way steps. The gain in employment in one month is lost in subsequent months. As growth in Connecticut is very much dependent on the growth in the national economy, and the economic recovery of the U.S. is entering a mature stage, the prospect for the Connecticut economy for the coming year is not looking particularly bright at the moment. n Francis W. Ahking, Department of Economics, University of Connecticut, Storrs, CT Phone: (860) Stan McMillen [(860) , Storrs Campus], Connecticut Center for Economic Analysis, University of Connecticut, provided research support. Leading and coincident employment indexes were developed by Pami Dua and Stephen M. Miller, in cooperation with Anirvan Banerji at the Economic Cycle Research Institute. Components of the indexes are described in the Technical Notes on page 23. l 4 THE CONNECTICUT ECONOMIC DIGEST

5 --Continued from page 2-- and growth of households (household formation) that are currently favorable to new housing demand. Consumer Spending Higher interest rates will also have negative implications for consumer spending. Rising consumer debt and higher interest rates will constrain future consumer spending, the single most important component of Gross Domestic Product in the national income accounts. Indicators of consumer activity in Connecticut in 2004 point to a weakening in consumer spending. Year-to-date Connecticut auto registrations, a proxy for new car sales, were down 3.2 percent. Visitors at major Connecticut tourism attractions year-to-date were down 1.4 percent. Both the New England and the U.S. consumer confidence indices were down by 18.6 and 12.2 percent of their respective highs. Conclusion The well worn phrase, wait until next year, which until recently was reserved for long suffering Red Sox fans, now seems appropriate in assessing the much anticipated but never fully realized 2004 economic recovery. Unfortunately, the dampening effect of rising interest rates on consumer spending, housing, construction, and business investment in both the U.S. and Connecticut will forestall rapid expansion of either economy next year. Despite this fact, I still expect Connecticut s long-term growth rate of 5 percent in the Gross State Product to be maintained as the State s high productivity and decadelong economic diversification continue to pay dividends. n HOUSING UPDATE Housing permits continue strong performance in November Commissioner James F. Abromaitis of the Connecticut Department of Economic and Community Development (DECD) announced that Connecticut communities authorized 1,297 new housing units in November 2004, a 69.3 percent increase compared to November of 2003 when 766 units were authorized. The Department further indicated that the 1,297 units permitted in November 2004 represent a 50.5 percent increase from the 862 units permitted in October The year-to-date permits are up 19.7 percent, from 9,156 through November 2003, to 10,956 through November Two of the ten Labor Market Areas showed losses compared to a year ago. Meriden led all municipalities with 186 units, followed by Stamford with 115 and South Windsor with 99. From a county perspective, only Tolland County showed a year-to-date loss. See data tables on pages 19 and 22. GENERAL ECONOMIC INDICATORS 3Q 3Q CHANGE 2Q É4FBTPOBMMZÁBEKVTUFE NO. % 2004 Employment Indexes (1992=100)* Leading Coincident General Drift Indicator (1986=100)* Leading Coincident Banknorth Business Barometer (1992=100)** Sources: *The Connecticut Economy, Connecticut Center for Economic Analysis, University of Connecticut **Banknorth Bank The Connecticut Economy's General Drift Indicators are composite measures of the four-quarter change in three coincident (Connecticut Manufacturing Production Index, nonfarm employment, and real personal income) and four leading (housing permits, manufacturing average weekly hours, Hartford help-wanted advertising, and initial unemployment claims) economic variables, and are indexed so 1986 = 100. The Banknorth Business Barometer is a measure of overall economic growth in the state of Connecticut that is derived from non-manufacturing employment, real disposable personal income, and manufacturing production. THE CONNECTICUT ECONOMIC DIGEST l 5

6 STATE ECONOMIC INDICATORS Total nonfarm employment increased by 6,100 over the year. EMPLOYMENT BY INDUSTRY SECTOR (Seasonally adjusted; 000s) NO. % 2004 TOTAL NONFARM , ,644.0 Construction Manufacturing Information Financial Activities Professional and Business Services Government* Source: Connecticut Department of Labor (see page 12 for other industries, not seasonally adjusted) * Includes Native American tribal government employment Initial claims for unemployment insurance fell from a year ago. UNEMPLOYMENT (Seasonally adjusted) NO. % 2004 Unemployment Rate, resident (%) Labor Force, resident (000s) 1, , ,788.4 Employed (000s) 1, , ,705.9 Unemployed (000s) Average Weekly Initial Claims 4,338 4, ,005 Help Wanted Index -- Htfd. (1987=100) Avg. Insured Unemp. Rate (%) Sources: Connecticut Department of Labor; The Conference Board The production worker weekly earnings rose over the year. MANUFACTURING ACTIVITY SEP (Not seasonally adjusted) NO. % Average Weekly Hours Average Hourly Earnings Average Weekly Earnings CT Mfg. Production Index (1986=100)* Production Worker Hours (000s) 4,985 5, , Industrial Electricity Sales (mil kwh)** Sources: Connecticut Department of Labor; U.S. Department of Energy *Seasonally adjusted. **Latest two months are forecasted. Personal income for first quarter 2005 is forecasted to increase 4.0 percent from a year earlier. INCOME (Seasonally adjusted) 1Q* 1Q CHANGE 4Q* (Annualized; $ Millions) NO. % 2004 Personal Income $163,215 $156,890 $6, $162,137 UI Covered Wages $84,633 $84,477 $ $83,417 Source: Bureau of Economic Analysis: October 2004 release *Forecasted by Connecticut Department of Labor l 6 THE CONNECTICUT ECONOMIC DIGEST

7 ECONOMIC INDICATORS STATE BUSINESS ACTIVITY Y/Y % YEAR TO DATE % MONTH LEVEL CHG CURRENT PRIOR CHG New Housing Permits NOV , ,956 9, Electricity Sales (mil kwh) SEP , ,277 24, Retail Sales (Bil. $) OCT Construction Contracts Index (1980=100) NOV New Auto Registrations NOV , , , Air Cargo Tons NOV , , , Exports (Bil. $) 3Q New auto registrations were down 7.4 percent from a year ago. Sources: Connecticut Department of Economic and Community Development; U.S. Department of Energy, Energy Information Administration; Connecticut Department of Revenue Services; F.W. Dodge; Connecticut Department of Motor Vehicles; Connecticut Department of Transportation, Bureau of Aviation and Ports BUSINESS STARTS AND TERMINATIONS Y/Y % YEAR TO DATE % MO/QTR LEVEL CHG CURRENT PRIOR CHG STARTS Secretary of the State NOV , ,316 23, Department of Labor* 2Q , ,894 4, TERMINATIONS Secretary of the State NOV ,679 8, Department of Labor* 2Q , ,684 3, Net business formation, as measured by starts minus stops registered with the Secretary of the State, was up 21.5 percent to 18,637 from the same period last year. Sources: Connecticut Secretary of the State; Connecticut Department of Labor * Revised methodology applied back to 1996; 3-months total STATE REVENUES YEAR TO DATE NOV NOV % % (Millions of dollars) CHG CURRENT PRIOR CHG TOTAL ALL REVENUES* , , Corporate Tax Personal Income Tax , , Real Estate Conv. Tax Sales & Use Tax , , Indian Gaming Payments** Gaming payments revenue increased 2.9 percent so far this year from the year-to-date level last year. Sources: Connecticut Department of Revenue Services; Division of Special Revenue *Includes all sources of revenue; Only selected sources are displayed; Most July receipts are credited to the prior fiscal year and are not shown. **See page 23 for explanation. TOURISM AND TRAVEL Y/Y % YEAR TO DATE % MONTH LEVEL CHG CURRENT PRIOR CHG Info Center Visitors NOV , , , Major Attraction Visitors NOV , ,726,133 1,759, Air Passenger Count NOV , ,156,002 5,733, Indian Gaming Slots (Mil.$)* NOV , ,560 17, Travel and Tourism Index** 3Q Year-to-date gaming slots rose 3.5 percent from a year ago. Sources: Connecticut Department of Transportation, Bureau of Aviation and Ports; Connecticut Department of Economic and Community Development; Connecticut Lodging & Attractions Association; Division of Special Revenue *See page 23 for explanation **The Connecticut Economy, Connecticut Center for Economic Analysis, University of Connecticut THE CONNECTICUT ECONOMIC DIGEST l 7

8 STATE ECONOMIC INDICATORS Compensation cost for the nation rose 3.7 percent over the year. EMPLOYMENT COST INDEX Seasonally Adjusted Not Seasonally Adjusted Private Industry Workers SEP JUN 3-Mo SEP SEP 12-Mo (June 1989=100) % Chg % Chg UNITED STATES TOTAL Wages and Salaries Benefit Costs NORTHEAST TOTAL Wages and Salaries Source: U.S. Department of Labor, Bureau of Labor Statistics U.S. inflation rate increased 3.5 percent over the year. CONSUMER NEWS % CHANGE É/PUÁTFBTPOBMMZÁBEKVTUFE MO/QTR LEVEL Y/Y P/P* CONSUMER PRICES Connecticut** 3Q NA --- CPI-U ( =100) U.S. City Average NOV Purchasing Power of $ ( =$1.00) NOV 2004 $ Northeast Region NOV NY-Northern NJ-Long Island NOV Boston-Brockton-Nashua*** NOV CPI-W ( =100) U.S. City Average NOV CONSUMER CONFIDENCE (1985=100) Connecticut** 3Q New England NOV U.S. NOV Sources: U.S. Department of Labor, Bureau of Labor Statistics; The Conference Board *Change over prior monthly or quarterly period **The Connecticut Economy, Connecticut Center for Economic Analysis, University of Connecticut ***The Boston CPI can be used as a proxy for New England and is measured every other month. 30-year conventional mortgage rate rose to 5.73 percent over the month. INTEREST RATES NOV OCT NOV É1FSDFOU Prime Federal Funds Month Treasury Bill Month Treasury Bill Year Treasury Bill Year Treasury Note Year Treasury Note Year Treasury Note Year Treasury Note Year Treasury Note Conventional Mortgage Sources: Federal Reserve; Federal Home Loan Mortgage Corp. l 8 THE CONNECTICUT ECONOMIC DIGEST

9 COMPARATIVE REGIONAL DATA STATE NONFARM EMPLOYMENT (Seasonally adjusted; 000s) NO. % 2004 Connecticut 1, , ,644.0 Maine Massachusetts 3, , ,179.2 New Hampshire New Jersey 4, , ,058.7 New York 8, , ,462.7 Pennsylvania 5, , ,655.0 Rhode Island Vermont United States 132, , , ,963.0 All nine states in the region added jobs over the year. Source: U.S. Department of Labor, Bureau of Labor Statistics LABOR FORCE (Seasonally adjusted; 000s) NO. % 2004 Connecticut 1, , ,788.4 Maine Massachusetts 3, , ,396.2 New Hampshire New Jersey 4, , ,414.1 New York 9, , ,312.8 Pennsylvania 6, , ,299.3 Rhode Island Vermont United States 148, , , ,850.0 Six of nine states posted increases in the labor force from last year. Source: U.S. Department of Labor, Bureau of Labor Statistics UNEMPLOYMENT RATES NOV NOV OCT (Seasonally adjusted) CHANGE 2004 Connecticut Maine Massachusetts New Hampshire New Jersey New York Pennsylvania Rhode Island Vermont United States Eight of nine states showed a decrease in its unemployment rate over the year. Source: U.S. Department of Labor, Bureau of Labor Statistics THE CONNECTICUT ECONOMIC DIGEST l 9

10 STATE ECONOMIC INDICATOR TRENDS NONFARM EMPLOYMENT É4FBTPOBMMZÁBEKVTUFE Month Thousands Jan 1, , ,639.3 Feb 1, , ,640.0 Mar 1, , ,638.2 Apr 1, , ,642.1 May 1, , ,646.2 Jun 1, , ,642.4 Jul 1, , ,638.1 Aug 1, , ,642.7 Sep 1, , ,643.9 Oct 1, , ,644.0 Nov 1, , ,646.7 Dec 1, ,639.7 UNEMPLOYMENT RATE É4FBTPOBMMZÁBEKVTUFE Month Percent 1,740 1,700 1,660 1,620 1,580 1,540 1, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec LABOR FORCE É4FBTPOBMMZÁBEKVTUFE Month Thousands 1,900 1,850 1,800 1,750 1,700 1,650 1, Jan 1, , ,794.1 Feb 1, , ,796.0 Mar 1, , ,786.7 Apr 1, , ,782.0 May 1, , ,797.7 Jun 1, , ,792.8 Jul 1, , ,793.9 Aug 1, , ,788.3 Sep 1, , ,791.0 Oct 1, , ,788.4 Nov 1, , ,792.6 Dec 1, ,797.4 AVERAGE WEEKLY INITIAL CLAIMS É4FBTPOBMMZÁBEKVTUFE Month ,000 8,000 7,000 6,000 5,000 4,000 3,000 2, Jan 5,507 5,050 4,351 Feb 4,813 5,372 4,746 Mar 5,109 5,133 4,259 Apr 5,658 5,160 4,302 May 6,245 4,790 3,938 Jun 5,596 4,768 4,079 Jul 5,123 4,962 3,917 Aug 5,072 4,897 4,050 Sep 5,266 4,763 4,067 Oct 5,517 4,544 4,005 Nov 5,197 4,578 4,338 Dec 5,382 4,883 l 10 THE CONNECTICUT ECONOMIC DIGEST

11 ECONOMIC INDICATOR TRENDS STATE REAL AVG MANUFACTURING HOURLY EARNINGS É/PUÁTFBTPOBMMZÁBEKVTUFE Month Dollars Jan $9.81 $9.71 $9.94 Feb $9.74 $9.72 $9.89 Mar $9.81 $9.83 $9.90 Apr $9.79 $9.78 $9.94 May $9.72 $9.86 $9.78 Jun $9.77 $9.88 $9.76 Jul $9.80 $9.96 $9.88 Aug $9.75 $9.87 $9.92 Sep $9.85 $9.93 $10.08 Oct $9.84 $9.93 $10.04 Nov $9.79 $9.96 $10.02 Dec $9.98 $10.02 AVG MANUFACTURING WEEKLY HOURS É/PUÁTFBTPOBMMZÁBEKVTUFE Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec HARTFORD HELP WANTED INDEX É4FBTPOBMMZÁBEKVTUFE Month = Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec DOL NET BUSINESS STARTS ÉNPOUIÁNPWJOHÁBWFSBHF Month *New series began in 2001; prior years are not directly comparable **New series began in 1996; prior years are not directly comparable Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec THE CONNECTICUT ECONOMIC DIGEST l 11

12 STATE NONFARM EMPLOYMENT ESTIMATES CONNECTICUT Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 1,663,800 1,657,700 6, ,653,900 GOODS PRODUCING INDUSTRIES 261, , ,800 CONSTRUCTION, NAT. RES. & MINING. 64,800 64, ,400 MANUFACTURING 196, , ,400 Durable Goods 145, , ,200 Fabricated Metal 33,300 33, ,200 Machinery 18,000 17, ,900 Computer and Electronic Product 15,000 15, ,900 Electrical Equipment 10,800 10, ,800 Transportation Equipment ,800 42, ,600 Aerospace Product and Parts 29,800 30, ,600 Non-Durable Goods 51,400 51, ,200 Printing and Related 8,100 7, ,900 Chemical 17,200 17, ,300 Plastics and Rubber Products 8,300 8, ,300 SERVICE PROVIDING INDUSTRIES 1,402,100 1,396,500 5, ,392,100 TRADE, TRANSPORTATION, UTILITIES.. 312, ,800 1, ,800 Wholesale Trade 65,500 65, ,300 Retail Trade 196, , ,200 Motor Vehicle and Parts Dealers 22,500 22, ,600 Building Material 15,700 15, ,900 Food and Beverage Stores 44,300 44, ,700 General Merchandise Stores 26,300 25, ,500 Transportation, Warehousing, & Utilities 50,500 49, ,300 Utilities 8,700 8, ,600 Transportation and Warehousing 41,800 41, ,700 INFORMATION 38,500 38, ,600 Telecommunications 13,900 14, ,900 FINANCIAL ACTIVITIES 142, , ,900 Finance and Insurance 122, , ,500 Credit Intermediation 32,300 33, ,500 Securities and Commodity Contracts 18,800 17,500 1, ,600 Insurance Carriers & Related Activities 66,500 67,700-1, ,600 Real Estate and Rental and Leasing 20,300 20, ,400 PROFESSIONAL & BUSINESS SERVICES 194, ,400-1, ,900 Professional, Scientific 86,500 87, ,300 Legal Services 15,400 15, ,200 Computer Systems Design 17,600 18, ,500 Management of Companies 27,700 27, ,600 Administrative and Support 80,700 81,700-1, ,000 Employment Services 27,300 27, ,500 EDUCATIONAL AND HEALTH SERVICES 270, ,200 2, ,900 Educational Services 52,900 51,600 1, ,400 Health Care and Social Assistance 217, ,600 1, ,500 Hospitals 54,900 54, ,700 Nursing & Residential Care Facilities 57,200 56, ,000 Social Assistance 33,700 33, ,700 LEISURE AND HOSPITALITY 129, ,700 5, ,500 Arts, Entertainment, and Recreation 24,300 22,600 1, ,100 Accommodation and Food Services 105, ,100 3, ,400 Food Serv., Restaurants, Drinking Places 93,900 90,900 3, ,800 OTHER SERVICES 62,800 62, ,600 GOVERNMENT 250, ,500-1, ,900 Federal Government 20,300 20, ,300 State Government. 66,900 68,000-1, ,000 **Local Government 163, , ,600 Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. **Includes Indian tribal government employment. l 12 THE CONNECTICUT ECONOMIC DIGEST

13 NONFARM EMPLOYMENT ESTIMATES LMA BRIDGEPORT LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 185, , ,300 GOODS PRODUCING INDUSTRIES 35,100 35, ,100 CONSTRUCTION, NAT. RES. & MINING. 6,900 6, ,000 MANUFACTURING 28,200 29, ,100 Durable Goods 23,600 24, ,500 SERVICE PROVIDING INDUSTRIES 149, , ,200 TRADE, TRANSPORTATION, UTILITIES.. 36,000 36, ,300 Wholesale Trade 6,900 7, ,900 Retail Trade 24,300 23, ,500 Transportation, Warehousing, & Utilities 4,800 5, ,900 INFORMATION 4,000 4, ,000 FINANCIAL ACTIVITIES 14,300 13, ,200 PROFESSIONAL & BUSINESS SERVICES 18,800 19,800-1, ,900 EDUCATIONAL AND HEALTH SERVICES 34,000 33, ,900 LEISURE AND HOSPITALITY 14,000 13, ,400 Accommodation and Food Services 10,900 10, ,100 OTHER SERVICES 6,400 6, ,400 GOVERNMENT 22,400 22, ,100 Federal 1,700 1, ,800 State & Local 20,700 20, ,300 For further information on the Bridgeport Labor Market Area contact Arthur Famiglietti at (860) DANBURY LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 91,200 89,900 1, ,400 GOODS PRODUCING INDUSTRIES 15,700 16, ,800 CONSTRUCTION, NAT. RES. & MINING. 4,300 4, ,300 MANUFACTURING 11,400 12, ,500 SERVICE PROVIDING INDUSTRIES 75,500 73,500 2, ,600 TRADE, TRANSPORTATION, UTILITIES.. 20,500 19, ,700 Wholesale Trade 3,000 2, ,000 Retail Trade 15,600 15, ,800 INFORMATION 2,500 2, ,500 FINANCIAL ACTIVITIES 4,300 4, ,200 PROFESSIONAL & BUSINESS SERVICES 9,400 10, ,700 EDUCATIONAL AND HEALTH SERVICES 14,200 13, ,100 LEISURE AND HOSPITALITY 6,900 6, ,000 OTHER SERVICES 4,300 3, ,200 GOVERNMENT 13,400 12, ,200 Federal State & Local 12,700 11, ,500 For further information on the Danbury Labor Market Area contact Arthur Famiglietti at (860) Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. THE CONNECTICUT ECONOMIC DIGEST l 13

14 LMA NONFARM EMPLOYMENT ESTIMATES HARTFORD LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 591, ,600-8, ,800 GOODS PRODUCING INDUSTRIES 87,800 93,000-5, ,600 CONSTRUCTION, NAT. RES. & MINING. 20,000 21,200-1, ,400 MANUFACTURING 67,800 71,800-4, ,200 Durable Goods 55,800 59,000-3, ,200 Fabricated Metal 13,700 14, ,900 Non-Durable Goods 12,000 12, ,000 SERVICE PROVIDING INDUSTRIES 504, ,600-3, ,200 TRADE, TRANSPORTATION, UTILITIES.. 101, ,100-2, ,800 Wholesale Trade 22,500 22, ,500 Retail Trade 59,800 62,000-2, ,200 Transportation, Warehousing, & Utilities 19,200 19, ,100 Transportation and Warehousing 15,600 16, ,500 INFORMATION 11,200 11, ,200 FINANCIAL ACTIVITIES 70,100 72,200-2, ,900 Finance and Insurance 65,700 66, ,500 Insurance Carriers & Related Activities 48,100 49,100-1, ,900 PROFESSIONAL & BUSINESS SERVICES 61,900 61, ,800 Professional, Scientific 27,100 27, ,000 Administrative and Support 26,400 26, ,300 EDUCATIONAL AND HEALTH SERVICES 89,500 89, ,700 Health Care and Social Assistance 78,500 78, ,200 LEISURE AND HOSPITALITY 42,600 41, ,400 Accommodation and Food Services 35,700 34,700 1, ,800 Food Serv., Restaurants, Drinking Places 32,000 31, ,100 OTHER SERVICES 24,300 24, ,200 GOVERNMENT 103, , ,200 Federal 7,200 7, ,200 State & Local 95,800 96, ,000 For further information on the Hartford Labor Market Area contact Arthur Famiglietti at (860) Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. BUSINESS AND ECONOMIC NEWS n Volunteer rates in 2004 About 64.5 million persons, or 28.8 percent of the (U.S.) civilian noninstitutional population age 16 and over, volunteered through or for organizations at least once from September 2003 to September One-fourth of men and about one-third of women did volunteer work in the year ended in September 2004, about the same proportions as in the prior year. Women volunteered at a higher rate than men across age groups, education levels, and other major characteristics. These data are from a supplement to the September 2004 Current Population Survey. Find out more in "Volunteering in the United States, 2004," news release USDL (The Editor's Desk, Bureau of Labor Statistics, December 17, 2004) n Educational attainment of foreign-born workers, 2003 In 2003, foreign-born workers made up about 14 percent of the U.S. civilian labor force age 16 and over. Nearly 30 percent of the foreign-born labor force 25 years old and over had not completed high school, compared with only about 7 percent of the native-born labor force. About equal proportions of both the foreign and native born had a college --Continued on the following page-- l 14 THE CONNECTICUT ECONOMIC DIGEST

15 NONFARM EMPLOYMENT ESTIMATES LMA NEW HAVEN LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 256, ,500-3, ,100 GOODS PRODUCING INDUSTRIES 40,500 40, ,400 CONSTRUCTION, NAT. RES. & MINING. 10,100 10, ,000 MANUFACTURING 30,400 30, ,400 Durable Goods 19,900 20, ,000 Non-Durable Goods 10,500 10, ,400 SERVICE PROVIDING INDUSTRIES 215, ,000-3, ,700 TRADE, TRANSPORTATION, UTILITIES.. 45,100 46,200-1, ,700 Wholesale Trade 9,900 10, ,000 Retail Trade 27,900 28, ,500 Transportation, Warehousing, & Utilities 7,300 7, ,200 INFORMATION 9,700 9, ,500 Telecommunications 6,300 6, ,200 FINANCIAL ACTIVITIES 14,000 13, ,000 Finance and Insurance 10,100 10, ,000 PROFESSIONAL & BUSINESS SERVICES 25,300 26, ,400 Administrative and Support 9,800 11,000-1, ,900 EDUCATIONAL AND HEALTH SERVICES 60,300 61,500-1, ,400 Educational Services 22,600 23,600-1, ,300 Health Care and Social Assistance 37,700 37, ,100 LEISURE AND HOSPITALITY 17,400 18, ,700 Accommodation and Food Services 15,000 15, ,300 OTHER SERVICES 10,300 10, ,300 GOVERNMENT 33,400 34, ,700 Federal 5,300 5, ,300 State & Local 28,100 28, ,400 For further information on the New Haven Labor Market Area contact Joseph Slepski at (860) Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. **Value less than 50 BUSINESS AND ECONOMIC NEWS (Cont.) degree (31 and 32 percent, respectively). These data are from the Current Population Survey. Find more information in "Labor Force Characteristics of Foreign-born Workers in 2003," news release USDL (The Editor's Desk, Bureau of Labor Statistics, December 2, 2004) n Consumer expenditures in 2003 At $40,817, average annual expenditures per consumer (in U.S.) were essentially unchanged in 2003, up 0.3 percent. This followed increases of 2.9 percent in 2002 and 3.9 percent in Among the major components of spending, the only statistically significant changes from 2002 to 2003 were a 6.2-percent decrease in spending on apparel and services and a 4.0-percent increase in personal insurance and pensions. Average expenditures on food and entertainment decreased over the period, 0.7 and 0.9 percent respectively, whereas housing rose 1.1 percent, transportation rose 0.3 percent, and health care rose 2.8 percent. Whereas expenditures showed little change from 2002 to 2003, there was a 2.3 percent annual average rise in the Consumer Price Index (CPI) over this period. These data come from the Consumer Expenditure Survey. Find out more in "Consumer Expenditures in 2003," USDL release (The Editor's Desk, Bureau of Labor Statistics, December 1, 2004) THE CONNECTICUT ECONOMIC DIGEST l 15

16 LMA NONFARM EMPLOYMENT ESTIMATES NEW LONDON LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 146, , ,100 GOODS PRODUCING INDUSTRIES 24,200 24, ,300 CONSTRUCTION, NAT. RES. & MINING. 4,900 4, ,000 MANUFACTURING 19,300 19, ,300 Durable Goods 12,100 11, ,100 Non-Durable Goods 7,200 7, ,200 SERVICE PROVIDING INDUSTRIES 122, , ,800 TRADE, TRANSPORTATION, UTILITIES.. 25,500 25, ,000 Wholesale Trade 2,300 2, ,300 Retail Trade 18,900 18, ,400 Transportation, Warehousing, & Utilities 4,300 4, ,300 INFORMATION 2,400 2, ,400 FINANCIAL ACTIVITIES 3,800 3, ,700 PROFESSIONAL & BUSINESS SERVICES 10,600 10, ,600 EDUCATIONAL AND HEALTH SERVICES 19,600 19, ,400 Health Care and Social Assistance 17,100 16, ,900 LEISURE AND HOSPITALITY 14,300 14, ,100 Accommodation and Food Services 12,100 12, ,700 Food Serv., Restaurants, Drinking Places 9,400 9, ,900 OTHER SERVICES 4,400 4, ,400 GOVERNMENT 41,500 41, ,200 Federal 2,400 2, ,400 **State & Local 39,100 39, ,800 For further information on the New London Labor Market Area contact Lincoln Dyer at (860) STAMFORD LMA Not Seasonally Adjusted NO. % 2004 TOTAL NONFARM EMPLOYMENT 198, , ,700 GOODS PRODUCING INDUSTRIES 16,100 16, ,300 CONSTRUCTION, NAT. RES. & MINING. 6,300 5, ,400 MANUFACTURING 9,800 10, ,900 SERVICE PROVIDING INDUSTRIES 182, , ,400 TRADE, TRANSPORTATION, UTILITIES.. 35,900 35, ,800 Wholesale Trade 7,200 7, ,300 Retail Trade 24,000 23, ,800 Transportation, Warehousing, & Utilities 4,700 4, ,700 INFORMATION 6,400 6, ,500 FINANCIAL ACTIVITIES 27,900 27, ,900 Finance and Insurance 23,800 23, ,800 PROFESSIONAL & BUSINESS SERVICES 43,700 45,500-1, ,700 Professional, Scientific 18,000 20,000-2, ,800 Management of Companies 9,900 10, ,700 Administrative and Support 15,800 15, ,200 EDUCATIONAL AND HEALTH SERVICES 23,500 22, ,600 Health Care and Social Assistance 20,400 19, ,500 LEISURE AND HOSPITALITY 16,700 16, ,100 Accommodation and Food Services 10,700 10, ,900 OTHER SERVICES 9,000 8, ,000 GOVERNMENT 18,900 19, ,800 Federal 1,600 1, ,600 State & Local 17,300 17, ,200 For further information on the Stamford Labor Market Area contact Joseph Slepski at (860) Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. **Includes Indian tribal government employment. l 16 THE CONNECTICUT ECONOMIC DIGEST

17 WATERBURY LMA NONFARM EMPLOYMENT ESTIMATES LMA Not Seasonally Adjusted Á NO. % 2004 TOTAL NONFARM EMPLOYMENT 82,700 83, ,600 GOODS PRODUCING INDUSTRIES 16,900 16, ,200 CONSTRUCTION, NAT. RES. & MINING. 3,700 3, ,800 MANUFACTURING 13,200 13, ,400 Durable Goods 10,800 10, ,000 SERVICE PROVIDING INDUSTRIES 65,800 66,900-1, ,400 TRADE, TRANSPORTATION, UTILITIES.. 16,200 16, ,800 Wholesale Trade 2,100 2, ,100 Retail Trade 11,500 11, ,100 Transportation, Warehousing, & Utilities 2,600 2, ,600 INFORMATION 1,300 1, ,300 FINANCIAL ACTIVITIES 3,600 3, ,600 PROFESSIONAL & BUSINESS SERVICES 8,300 8, ,200 EDUCATIONAL AND HEALTH SERVICES 14,900 15, ,000 Health Care and Social Assistance 13,700 13, ,800 LEISURE AND HOSPITALITY 5,900 5, ,800 OTHER SERVICES 3,100 3, ,100 GOVERNMENT 12,500 13, ,600 Federal State & Local 11,800 12, ,900 For further information on the Waterbury Labor Market Area contact Joseph Slepski at (860) SMALLER LMAS Not Seasonally Adjusted Á NO. % 2004 TOTAL NONFARM EMPLOYMENT DANIELSON LMA 22,500 21, ,300 LOWER RIVER LMA 10,300 10, ,400 TORRINGTON LMA 28,900 28, ,100 Current month s data are preliminary. Prior months data have been revised. All data are benchmarked to March *Total excludes workers idled due to labor-management disputes. NOTE: More industry detail data is available for the State and its ten labor market areas at: The data published there differ from the data in the preceding tables in that they are developed from a near-universe count of Connecticut employment covered by the unemployment insurance (UI) program, while the data here is sample-based. The data drawn from the UI program does not contain estimates of employment not covered by unemployment insurance, and is lagged several months behind the current employment estimates presented here. THE CONNECTICUT ECONOMIC DIGEST l 17