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THE CONNECTICUT
Vol.10 No.2
A joint publication of the Connecticut Department of Labor & the Connecticut Department of Economic and Community Development

FEBRUARY 2005
IN THIS ISSUE...

By Lincoln S. Dyer, Economist, DOL n August 1996, the Office of Research at the Connecticut Department of Labor (CTDOL) performed an analysis on Connecticut’s private defenserelated employment by tracking industries that were isolated from a U.S. Bureau of Labor Statistics defense model (“Employment in private defenserelated industries drops again in 1995,” www.ctdol.state.ct.us/ lmi/misc/cedaug96.htm#index.) This input-output model of the U.S. economy concluded that at least 40 percent of the product of these industries was related to defense (under the old Standard Industrial Classification System SIC). Since many defense contractors also have commercial/ civilian production lines, jet engines for example, it is difficult to determine the exact number of pure private defense-related jobs. This is why we utilized this BLS model. It helped provide a

Defense-Related Employment: Can Connecticut Stop the Decline?
I
baseline of confirmed industries strongly influenced by defense expenditures to measure the employment levels year to year. These industries under the previous SIC definitions included weapons, ordnance and accessories (except vehicles and guided missiles) (348), aircraft and parts (372), shipbuilding and repairing (3731), guided missiles and space vehicles and parts (376), tanks and tank components (3795), search and navigation equipment (381), explosives (2892), and radio and communication equipment (3663, 3669). Also included were research sectors that contributed to defense such as physical, biological, economic, sociological, and educational research and their testing laboratories (8731, 8732, and 8743). Notice that 1988 job levels under these SIC-defined-defense-related industries were almost cut in half by 2002 (see Table 1).

Defense-Related Employment: Can Connecticut Stop the Decline? ................................. 1-3,5

Housing Update ................................. 5 Economic Indicators
of Employment ........................................ 4 on the Overall Economy ......................... 5 Individual Data Items ......................... 6-8

Comparative Regional Data .............. 9 Economic Indicator Trends ....... 10-11 Business & Economic News ..... 14-15 Labor Market Areas:
Nonfarm Employment .................... 12-17 Labor Force ............................................ 18 Hours and Earnings .............................. 19 Housing Permits .................................... 19

Cities and Towns:
Labor Force ..................................... 20-21 Housing Permits .................................... 22

Technical Notes ............................... 23 At a Glance ....................................... 24

In December...

Nonfarm Employment
Connecticut ..................... 1,647,700
Change over month ............. 0.04% Change over year .................. 0.5%

Table 1. Defense-Related Employment 1988-2002 (SIC-based) 1988 - 96,200* 1989 - 95,300 1990 - 91,800 1991 - 87,800 1992 - 80,200 1993 - 71,700 1994 - 65,900 1995 - 61,300 1996 - 58,700 1997 - 57,400 1998 - 57,900 1999 - 54,900 2000 - 52,800 2001 - 53,400 2002 - 52,300

United States .............. 132,266,000
Change over month ............. 0.12% Change over year .................. 1.7%

Unemployment Rate
Connecticut ............................. 4.3% United States .......................... 5.4%

Consumer Price Index
United States ......................... 190.3
Change over year ................... 3.3%

*A labor-management dispute in the third quarter of 1988 at a major employer considerably impacted private defense-related employment. The above figure does not include the data for months the company was involved in the dispute.

February 2005

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 CONNECTICUT

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 06109-1114. 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 06109-1114 Phone: (860) 263-6275 Fax: (860) 263-6263 E-Mail: [email protected] Website: http://www.ctdol.state.ct.us/lmi

However, in the last few years, the U.S. and consequently all of North America has updated its industrial classification system from the Standard Industrial Classification (SIC) to the North American Industry Classification System (NAICS). Many industries are not directly convertible from SIC to NAICS, so this baseline to some extent was altered. A new defense-related employment model probably should be determined, or a new emphasis at the job or occupational level will emerge, so these comparisons can continue. In the absence of an accepted standard, we made an effort to convert those defense sectors from SIC to NAICS in order to evaluate current defense-related employment trends in Connecticut. This was done by identifying NAICS sector codes that best aligned with the old SIC system despite changes to the coding system. The time series breaks were then evaluated to see how well they compared over the 1999-2002 period when both SIC and NAICS were being used. In this way we produced a time series that bridged the defense-related employment we had tracked under SIC to the new NAICSbased data that is currently available. The NAICS codes that were “crosswalked” from the SIC are as follows (Table 2): Table 2
NAICS (new)
32592 (Explosives Manufacturing) 33299 (All other Fabricated Metal Product Manufacturing, Small arms, ordnance, and ammunition found here) 334511 (Search,Detection,Navigation, Guidance,Aeronautical, and Nautical System and Instrument Manufacturing) 3364 (AerospaceProducts and Parts Manufacturing including Guided Missiles and Space Vehicle Manufacturing) 3366 (Ship and Boat Building) 336992 (Military Armored Vehicle, Tank, and Tank Component) 5417 (Scientific Research and Development Services)

NAICS Conversion As defense-related industries under NAICS, we came up with 32592 (Explosives Manufacturing), 33299 (All Other Fabricated Metal Product Manufacturing) where we found small arms and other ordnance and ammunition manufacturing, 334511 (Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing), 3364 (Aerospace Products and Parts Manufacturing including Guided Missiles and Space Vehicle Manufacturing), 3366 (Ship and Boat Building), 336992 (Military Armored Vehicle, Tank, and Tank Component, and 5417 (Scientific Research and Development Services). Aggregate employment in these NAICS industries is shown in Table 3. It should be noted that, in the conversion to NAICS, some employment identified under the SIC system may be distributed among many NAICS industries, as NAICS is a process-based classification system as opposed to a product-based system. For example, operations like research and development or headquarters often were split off to their own sector classifications.

SIC (old)
2892 (Explosives) 348 (Weapons, Ordnance, and Accessories,except Manufacturing Vehicles and Guided Missiles) 381 (Search and Navigation Equipment)

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 06106-2502 Phone: (860) 270-8000 Fax: (860) 270-8200 E-Mail: [email protected] Website: http://www.decd.org

372 (Aircraft and Parts)

3731 (Shipbuilding and Repairing) 3795 (Tanks and Tank Components) 8731,8732,8734 (Physical, Biological, Economic, Sociological, and Educational Research and their Testing Laboratories)

lTHE CONNECTICUT ECONOMIC DIGEST
2

February 2005

Table 3. Defense-Related Employment 1999-2003 (NAICS-based)

1999 - 52,000 2000 - 51,000 2001 - 50,800 2002 - 50,700 2003 - 48,600

coding system, there was dual coding under both classification systems being performed and tracked for a few overlapping years. So, after SIC was fully discontinued and NAICS fully in use, the CTDOL Office of Re-

Chart 1. CT's Private Defense-related Employment under NAICS (Jan. 1999 - Sep. 2004)
54,000 53,500 53,000 52,500 52,000 51,500 51,000 50,500 50,000 49,500 49,000 48,500 48,000 47,500 47,000 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04

company headquarters designation and research and development operations, for example, could have caused major discrepancies in the general overall trend. That did not seem to be the case. While there are definitely some differences in aggregate levels, the trends seem to be comparable and by the last few months of dual coding comparability the levels appear to be coming together (see Chart 2). Conclusion Connecticut’s private defense-related employment, traditionally one of America’s “Arsenals of Democracy,” has been severely reduced since 1988 when employment levels measured close to 100,000. The private defense job level has been cut in half since the end of the Cold War. Productivity gains have been partly responsible for some of the job declines, but decreased defense expenditures after the Cold War undoubtedly accounts for the bulk of the job loss. Only a slight upturn resulted from the increased de--Continued on page 5--

Convergence of NAICS and SIC Private Defense-related Employment Before NAICS was fully implemented and the statistical community was still using the SIC

search was able to compare and contrast the NAICS defense sector conversion to the now outof-use SIC system. The differences in the coding systems mentioned earlier were assessed. Differences in coding for

Chart 2. CT Private Defense-related Employment
100,000

SIC
90,000

SIC aa

NAICS

NAICS aa

80,000

70,000

60,000

50,000

40,000 Jan-88 Jan-89 Jan-90 Jan-91 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
3

EMPLOYMENT INDICATORS
LEADING INDEX
120 120 110 100 100 90 90 80 80 70
Tr o u g h 1 0 /7 1 P ea k 12 /69 Peak 5 /7 4 Pe a k 3 /8 0 Pe ak 4 /8 8

COINCIDENT INDEX

110

Tr o ug h 2/9 2 T r ou gh 1 /83

Tr o u g h 11 /7 5

70 1970 1975 1980 1985 1990 1995 2000

60 1970 1975 1980 1985 1990 1995 2000

More of the Same: We Are Not Sinking but We Are Not Swimming Either
he U.S. economy turned in a strong performance for 2004, despite rising energy costs and the Federal Reserve’s several hikes in the Federal Funds rate. The 3.3% preliminary estimate of the CPI inflation rate for 2004 is high by recent experience, and no one is expecting the Federal Reserve to stop hiking the Federal Funds rate in 2005. At the same time, however, few economists expect the Federal Reserve to abandon its measured approach to rate hikes in favor of a more aggressive stance. This is because the core CPI inflation rate, closely watched by the Federal Reserve, came in at 2.2% for 2004, which is in line with expectations. Going into 2005, there are a few trouble spots deserving careful monitoring. Given the situation in the Middle East, oil prices can be expected to continue to be volatile. The large and growing twin federal budget and trade deficits will continue to cast a shadow on the economy. That said, few economists expect a recession in 2005, but the growth in the U.S. economy may not be as robust as it was in the past two years. This too may be expected because we are entering the mature phase of the current expansion. The two employment indices for November provide us with some encouraging signs. The revised CCEA-ECRI Connecticut coincident employment index rose on a yearto-year basis from 106.39 in

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.

T

November 2003 to 107.96 in November 2004. 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 107.85 in October 2004 to 107.96 in November 2004. The sole negative contributor is a rise in total unemployment rate from 4.6% to 4.7% in November. Both total non-farm employment and total employment rose from October to November, while the insured unemployment rate remained at its October level of 2.67%. The revised CCEA-ECRI Connecticut leading employment index also provided us with encouraging news. It rose from 115.68 in November 2003 to 116.86 in November 2004. Three components of this index are positive contributors, with a lower Moody’s Baa corporate bond yield, a large jump in the number of total housing permits (a 91% increase), and a lower short duration (less than 15 weeks) unemployment rate. The three negative contributors are higher initial claims for unemployment insurance, a lower Hartford help-wanted advertising index, and lower average weekly hours worked

in manufacturing and construction. On a sequential month-to-month basis, the revised CCEA-ECRI Connecticut leading employment index rose slightly from 116.82 in October to 116.86 in November 2004, driven mostly also by an extraordinary 91% increase in total housing permits from October to November. The only other positive contributor is a lower short duration (less than 15 weeks) unemployment rate. The Moody’s Baa corporate bond yield remained constant from October to November, while the three negative contributors are higher initial claims for unemployment insurance, a lower Hartford help-wanted advertising index, and lower average weekly hours worked in manufacturing and construction. The projected state budget deficit continues to cast a cloud on the outlook for the Connecticut economy. Governor Rell has yet to announce a comprehensive plan to address these issues beyond banning state-funded state employee travel and a general hiring freeze of state employees except for critical positions. I hope that Governor Rell and the legislature will work together to find creative ways to close the budget gap without putting too many hurdles in the path of Connecticut’s economic recovery, which has been anemic thus far. n

lTHE CONNECTICUT ECONOMIC DIGEST
4

Francis W. Ahking, Department of Economics, University of Connecticut, Storrs, CT 06269. Phone: (860) 486-3026. Stan McMillen [(860) 486-0485, 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.

February 2005

--Continued from page 3--

fense spending since 9/11. The job decline resumed after 2002 but started to even out by September 2004 and now measures roughly 48,700 private defenserelated positions. In some ways this level of defense jobs seems to be at almost a subsistence leveling or critical mass point that should be maintained. An economic initiative to sustain 50,000 private defense-related jobs in conjunction with maintaining 200,000 overall manufacturing jobs in the

State could dovetail with each other nicely as almost 90 percent of defense-related employment is in manufacturing. The other 10 percent is employed in R&D, which also supports manufacturing and other spin-off developments for civilian use. The high-value jobs created, increased defense spending since 9/11, and the lack of direct low-cost competition from foreign companies for defense sector work because of security issues makes this sector critical for Connecticut’s ability to have

good paying jobs for its citizens, provide overall industrial diversification for the State, and provide security for our nation. No wonder Connecticut is fighting hard to keep the U.S. Submarine Base off the base closure list. This would help preserve the complimentary submarine building infrastructure of General Dynamic’s Electric Boat Shipyard nearby in Groton. Maintaining Connecticut’s capacity to produce is worth fighting for. n

HOUSING UPDATE

Banner Year for Connecticut's Housing Sector
Commissioner James F. Abromaitis of the Connecticut Department of Economic and Community Development (DECD) announced that Connecticut communities authorized 1,002 new housing units in December 2004, a 20.9 percent increase compared to December of 2003 when 829 units were authorized. The Department further indicated that the 1,002 units permitted in December 2004 represent a 22.7 percent decrease from the 1,297 units permitted in November 2004. The year-to-date permits are up 19.8 percent, from 9,985 through December 2003, to 11,958 through December 2004. “2004 was a remarkably strong year for Connecticut’s housing market,” said DECD Commissioner Abromaitis. “The 11,958 permit total for 2004 was the highest since 1989 and marked the fourth consecutive year of permit growth.” Bristol led all municipalities with 149 units in December, followed by New London with 113 and Hartford with 35. For the year, Danbury led all cities and towns with 398 units authorized in 2004. From a county perspective, Fairfield County showed the largest growth (40.6 percent) on a year-to-date basis. See data tables on pages 19 and 22.

GENERAL ECONOMIC INDICATORS
ÉRpf„€yfwwÁfiu†„…pi

3Q 2004 116.6 107.8 103.0 101.5 118.3

3Q 2003 114.3 106.2 101.2 101.8 116.0

CHANGE NO. % 2.4 1.7 2.1 1.6

2Q 2004 116.5 107.8 102.3 101.6 117.9

Employment Indexes (1992=100)* Leading Coincident General Drift Indicator (1986=100)* Leading Coincident Banknorth Business Barometer (1992=100)**

1.8 1.8 -0.3 -0.3 2.3 2.0

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.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
5

STATE

ECONOMIC INDICATORS
Total nonfarm

employment increased by 8,000 over the year. (Seasonally adjusted; 000s)

EMPLOYMENT BY INDUSTRY SECTOR
TOTAL NONFARM Construction Manufacturing Information Financial Activities Professional and Business Services Government* DEC 2004 1647.7 62.3 197.0 38.6 142.6 193.0 243.2 DEC 2003 1,639.7 61.4 196.2 38.9 143.6 194.2 244.2 CHANGE NO. % 8.0 0.5 0.9 1.5 0.8 0.4 -0.3 -0.8 -1.0 -0.7 -1.2 -0.6 -1.0 -0.4 NOV 2004 1,647.1 62.4 196.7 38.6 142.4 193.7 242.7

Source: Connecticut Department of Labor (see page 12 for other industries, not seasonally adjusted) * Includes Native American tribal government employment

Initial claims for unem- UNEMPLOYMENT ployment insurance fell from a year ago. (Seasonally adjusted)
Unemployment Rate, resident (%) Labor Force, resident (000s) Employed (000s) Unemployed (000s) Average Weekly Initial Claims Help Wanted Index -- Htfd. (1987=100) Avg. Insured Unemp. Rate (%)

DEC 2004 4.3 1,797.4 1,719.6 77.8 4,210 11 2.56

DEC 2003 5.5 1,797.4 1,699.0 98.4 4,883 10 3.24

CHANGE NO. % -1.2 --0.0 0.0 20.6 1.2 -20.6 -20.9 -673 -13.8 1 10.0 -0.68 ---

NOV 2004 4.7 1,792.8 1,709.1 83.8 4,338 8 2.60

Sources: Connecticut Department of Labor; The Conference Board

The production worker

weekly earnings rose over the year. (Not seasonally adjusted)

MANUFACTURING ACTIVITY
DEC 2004 Average Weekly Hours 42.5 Average Hourly Earnings 18.85 Average Weekly Earnings 801.13 CT Mfg. Production Index (1986=100)* 115.3 Production Worker Hours (000s) 5,085 Industrial Electricity Sales (mil kWh)** 400 DEC 2003 42.5 18.02 765.85 107.9 5,017 375 CHANGE NO. % 0.0 0.0 0.83 4.6 35.28 4.6 7.4 6.9 68 1.4 25.3 6.8 NOV 2004 42.0 18.76 787.92 115.5 4,983 419 OCT 2004 ---117.9 -455

Sources: Connecticut Department of Labor; U.S. Department of Energy *Seasonally adjusted. **Latest two months are forecasted.

Personal income for second quarter 2005 is forecasted to increase 4.9 percent from a year earlier.

INCOME
(Seasonally adjusted) (Annualized; $ Millions) Personal Income UI Covered Wages 2Q* 2Q 2005 2004 $165,467 $157,751 $85,161 $80,868 CHANGE NO. % $7,716 4.9 $4,293 5.3 1Q* 2005 $164,749 $87,804

Source: Bureau of Economic Analysis: January 2005 release *Forecasted by Connecticut Department of Labor

lTHE CONNECTICUT ECONOMIC DIGEST
6

February 2005

ECONOMIC INDICATORS
BUSINESS ACTIVITY
New Housing Permits Electricity Sales (mil kWh) Retail Sales (Bil. $) Y/Y % YEAR TO DATE MONTH LEVEL CHG CURRENT PRIOR DEC 2004 1,002 20.9 11,958 9,985 OCT 2004 2,415 0.3 26,593 26,633 OCT 2003 3.28 -0.6 34.19 34.55 % CHG 19.8 -0.2 -1.0

STATE

New auto registrations were down 6.9 percent from 2003.

Construction Contracts Index (1980=100) DEC 2004 286.0 -11.1 ------New Auto Registrations DEC 2004 20,739 -7.5 235,587 253,176 -6.9 Air Cargo Tons DEC 2004 14,158 5.8 154,850 142,293 8.8 Exports (Bil. $) 3Q 2004 2.00 -4.8 6.33 6.01 5.3 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
MO/QTR STARTS Secretary of the State DEC 2004 Department of Labor* 2Q 2004 TERMINATIONS Secretary of the State DEC 2004 Department of Labor* 2Q 2004 Y/Y % % YEAR TO DATE LEVEL CHG CURRENT PRIOR CHG 2,086 2,204 1,713 1,220 0.9 -2.2 -10.6 -28.2 28,439 26,067 4,894 4,952 9,426 10,580 2,684 3,485 9.1 -1.2 -10.9 -23.0

Net business formation, as measured by starts minus stops registered with the Secretary of the State, was up 22.8 percent to 19,013 from 2003.

Sources: Connecticut Secretary of the State; Connecticut Department of Labor * Revised methodology applied back to 1996; 3-months total

STATE REVENUES
YEAR TO DATE (Millions of dollars) TOTAL ALL REVENUES* Corporate Tax Personal Income Tax Real Estate Conv. Tax Sales & Use Tax Indian Gaming Payments** DEC 2004 1,014.7 103.5 509.5 19.7 258.2 33.5 DEC 2003 893.9 62.3 442.8 12.8 244.7 30.2 % CHG 13.5 66.1 15.1 53.9 5.5 10.9 CURRENT 10,678.5 593.6 5,103.2 188.2 3,196.8 411.4 PRIOR 9,680.9 431.7 4,413.6 144.4 3,075.2 397.6 % CHG 10.3 37.5 15.6 30.3 4.0 3.5

Gaming payments revenue increased 3.5 percent from 2003.

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 % MONTH LEVEL CHG Info Center Visitors DEC 2004 26,969 19.6 Major Attraction Visitors DEC 2004 91,897 3.3 Air Passenger Count DEC 2004 577,126 9.2 Indian Gaming Slots (Mil.$)* DEC 2004 1,620 8.8 Travel and Tourism Index** 3Q 2004 --- -1.0 YEAR TO DATE % CURRENT PRIOR CHG 437,090 489,903 -10.8 1,818,030 1,848,459 -1.6 6,733,128 6,261,807 7.5 20,180 19,429 3.9 -------

Gaming slots rose 3.9 percent from 2003.

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

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
7

STATE

ECONOMIC INDICATORS
EMPLOYMENT COST INDEX
Private Industry Workers (June 1989=100) UNITED STATES TOTAL Wages and Salaries Benefit Costs NORTHEAST TOTAL Wages and Salaries Seasonally Adjusted Not Seasonally Adjusted DEC SEP 3-Mo DEC DEC 12-Mo 2004 2004 % Chg 2004 2003 % Chg 175.8 174.5 0.7 175.2 168.8 3.8 166.4 165.8 0.4 166.2 162.3 2.4 199.3 196.4 1.5 198.7 185.8 6.9 ------------174.2 165.0 167.9 160.9 3.8 2.5

Compensation cost for the nation rose 3.8 percent over the year.

Source: U.S. Department of Labor, Bureau of Labor Statistics

U.S. inflation rate increased 3.3 percent over the year.

CONSUMER NEWS
ÉG€…Á„pf„€yfwwÁfiu†„…pi

MO/QTR 3Q 2004 DEC 2004 DEC 2004 DEC 2004 NOV 2004 DEC 2004 3Q 2004 DEC 2004 DEC 2004

LEVEL --190.3 $0.525 201.9 206.8 211.7 186.0 94.2 104.7 102.3

% CHANGE Y/Y P/P* NA 3.3 -3.2 3.6 3.8 2.5 3.4 40.6 13.2 7.9 ---0.4 0.4 -0.3 -0.2 0.9 -0.4 -11.5 18.3 10.5

CONSUMER PRICES Connecticut**

CPI-U (1982-84=100)
U.S. City Average Northeast Region NY-Northern NJ-Long Island Boston-Brockton-Nashua***
Purchasing Power of $ (1982-84=$1.00) DEC 2004

CPI-W (1982-84=100)
U.S. City Average CONSUMER CONFIDENCE (1985=100) Connecticut** New England U.S.

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 5.75 percent over the month.

INTEREST RATES
ÉIpƒhpy…

Prime Federal Funds 3 Month Treasury Bill 6 Month Treasury Bill 1 Year Treasury Bill 3 Year Treasury Note 5 Year Treasury Note 7 Year Treasury Note 10 Year Treasury Note 20 Year Treasury Note Conventional Mortgage

DEC 2004 5.14 2.16 2.19 2.43 2.67 3.21 3.60 3.93 4.23 4.88 5.75

NOV 2004 4.93 1.93 2.07 2.27 2.50 3.09 3.53 3.88 4.19 4.89 5.73

DEC 2003 4.00 0.98 0.90 0.99 1.31 1.91 3.27 3.79 4.27 5.38 5.88

Sources: Federal Reserve; Federal Home Loan Mortgage Corp.

lTHE CONNECTICUT ECONOMIC DIGEST
8

February 2005

COMPARATIVE REGIONAL DATA
NONFARM EMPLOYMENT
(Seasonally adjusted; 000s) Connecticut Maine Massachusetts New Hampshire New Jersey New York Pennsylvania Rhode Island Vermont United States DEC DEC 2004 2003 1,647.7 1,639.7 615.4 609.1 3,175.5 3,169.1 631.8 622.3 4,075.1 3,999.2 8,476.7 8,418.2 5,655.5 5,585.0 489.8 485.7 302.4 299.3 132,266.0 130,035.0 CHANGE NOV NO. % 2004 8.0 0.5 1,647.1 6.3 1.0 614.0 6.4 0.2 3,178.8 9.5 1.5 631.8 75.9 1.9 4,071.3 58.5 0.7 8,471.5 70.5 1.3 5,653.8 4.1 0.8 488.7 3.1 1.0 301.6 2,231.0 1.7 132,109.0

STATE

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) Connecticut Maine Massachusetts New Hampshire New Jersey New York Pennsylvania Rhode Island Vermont United States DEC DEC 2004 2003 1,797.4 1,797.4 704.3 699.4 3,382.0 3,393.5 729.8 725.3 4,404.0 4,387.6 9,358.2 9,289.3 6,321.2 6,133.8 563.1 572.9 354.2 350.8 148,203.0 146,808.0 CHANGE NOV NO. % 2004 0.0 0.0 1,792.8 4.9 0.7 703.0 -11.5 -0.3 3,388.6 4.5 0.6 729.6 16.4 0.4 4,412.9 68.9 0.7 9,325.2 187.4 3.1 6,316.0 -9.8 -1.7 564.3 3.4 1.0 353.0 1,395.0 1.0 148,313.0

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
(Seasonally adjusted) Connecticut Maine Massachusetts New Hampshire New Jersey New York Pennsylvania Rhode Island Vermont United States DEC 2004 4.3 4.7 4.6 3.3 4.2 5.3 5.6 4.6 3.4 5.4 DEC 2003 5.5 5.2 5.9 4.1 5.6 6.3 5.2 5.1 4.7 5.7 CHANGE -1.2 -0.5 -1.3 -0.8 -1.4 -1.0 0.4 -0.5 -1.3 -0.3 NOV 2004 4.7 4.5 4.6 3.1 4.4 4.9 5.4 4.5 3.1 5.4

Eight of nine states showed a decrease in its unemployment rate over the year.

Source: U.S. Department of Labor, Bureau of Labor Statistics

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
9

STATE

ECONOMIC INDICATOR TRENDS
Quarter First Second Third Fourth 2003 1.0 1.2 2.1 3.7 2004 5.2 5.3 5.1 5.0 2005 5.0 4.9

PERSONAL INCOME ÉRpf„€yfwwÁfiu†„…pi
10 Year-over-year % changes 8 6 4 2 0 -2 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05

UI COVERED WAGES ÉRpf„€yfwwÁfiu†„…pi
18 Year-over-year % changes 15 12 9 6 3 0 -3 -6 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05

Quarter First Second Third Fourth

2003 1.0 1.0 1.7 3.1

2004 5.9 4.0 5.0 6.2

2005 2.9 5.3

U.S. EMPLOYMENT COST INDEX
6 6 5 5 4 4 3 3 2 2 1 90 91 92 93 94 95 96 97

ÉRpf„€yfwwÁfiu†„…pi

Quarter First Second Third Fourth

Year-over-year % changes

2002 3.9 4.0 3.7 3.6

2003 3.9 3.8 4.0 3.9

2004 3.8 3.9 3.8 3.7

98

99

00

01

02

03

04

U.S. CONSUMER PRICE INDEX ÉG€…Á„pf„€yfwwÁfiu†„…pi
7 Year-over-year % changes 6 5 4 3 2 1 0 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2002 1.1 1.1 1.5 1.6 1.2 1.1 1.5 1.8 1.5 2.0 2.2 2.4

2003 2.6 3.0 3.0 2.2 2.1 2.1 2.1 2.2 2.3 2.0 1.8 1.9

2004 1.9 1.7 1.7 2.3 3.1 3.3 3.0 2.7 2.5 3.2 3.5 3.3

lTHE CONNECTICUT ECONOMIC DIGEST
10

February 2005

ECONOMIC INDICATOR TRENDS
SALES TAX
30 Year-over-year % changes 20 10 0 -10 -20 -30 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

STATE

Quarter FY 2002 FY 2003 FY 2004 First -0.5 -0.3 0.7 Second 2.1 -5.1 4.1 Third -2.3 -2.7 0.5 Fourth -1.0 1.3 1.8

REAL ESTATE TAX
60 Year-over-year % changes 40 20 0 -20 -40 -60 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

Quarter FY 2002 FY 2003 FY 2004 First -0.8 30.8 15.8 Second -10.2 27.2 21.4 Third 9.6 0.6 31.5 Fourth 21.7 -8.6 47.8

PERSONAL INCOME TAX : SALARIES & WAGES
25 Year-over-year % changes 20 15 10 5 0 -5 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

Quarter FY 2002 FY 2003 FY 2004 First -3.0 1.6 0.0 Second -3.0 -2.1 4.3 Third -0.4 -0.3 12.9 Fourth -1.6 0.5 6.6

PERSONAL INCOME TAX : ALL OTHER SOURCES
60 Year-over-year % changes 40 20 0 -20 -40 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

Quarter FY 2002 FY 2003 FY 2004 First -3.5 -12.6 -3.1 Second -2.3 -33.4 -0.5 Third -30.6 -5.8 27.7 Fourth -33.5 -15.8 43.2

Note: These economic growth rates were derived by the Office of Fiscal Analysis and were made by comparing tax collections in each quarter with the same quarter in the previous year and were adjusted for legislative changes

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
11

STATE

NONFARM EMPLOYMENT ESTIMATES
CONNECTICUT
DEC 2004

Not Seasonally Adjusted
DEC 2003 1,660,900 258,900 61,900 197,000 145,700 32,900 17,800 15,300 10,700 43,000 30,000 51,300 7,900 17,200 8,000 1,402,000 316,400 65,500 200,800 22,400 16,200 44,400 26,600 50,100 8,800 41,300 39,000 14,100 143,700 123,400 33,100 17,700 67,700 20,300 196,000 87,700 15,300 18,000 27,600 80,700 27,400 268,600 51,300 217,300 54,600 57,200 33,700 125,400 23,000 102,400 91,300 62,800 250,100 20,900 67,300 161,900 CHANGE NO. % 8,100 1,700 900 800 500 900 200 -200 100 -100 -200 300 300 100 200 6,400 1,500 0 800 0 200 -100 800 700 0 700 -300 -200 -1,000 -1,000 -900 1,300 -1,300 0 -1,300 -600 100 -500 200 -900 -200 2,300 1,500 800 200 200 0 5,200 1,600 3,600 3,400 1,000 -1,000 -500 -1,000 500 NOV 2004

TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… Durable Goods………………………………… Fabricated Metal……………………………… Machinery…………………………………… Computer and Electronic Product………… Electrical Equipment………………………… Transportation Equipment . . . . . . . . . . . . . . Aerospace Product and Parts…………… Non-Durable Goods………………………… Printing and Related………………………… Chemical……………………………………… Plastics and Rubber Products……………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Motor Vehicle and Parts Dealers…………… Building Material……………………………… Food and Beverage Stores………………… General Merchandise Stores……………… Transportation, Warehousing, & Utilities…… Utilities………………………………………… Transportation and Warehousing………… INFORMATION………………………………… Telecommunications………………………… FINANCIAL ACTIVITIES……………………… Finance and Insurance……………………… Credit Intermediation………………………… Securities and Commodity Contracts……… Insurance Carriers & Related Activities…… Real Estate and Rental and Leasing……… PROFESSIONAL & BUSINESS SERVICES Professional, Scientific……………………… Legal Services……………………………… Computer Systems Design………………… Management of Companies………………… Administrative and Support………………… Employment Services……………………… EDUCATIONAL AND HEALTH SERVICES Educational Services………………………… Health Care and Social Assistance………… Hospitals……………………………………… Nursing & Residential Care Facilities……… Social Assistance…………………………… LEISURE AND HOSPITALITY………………… Arts, Entertainment, and Recreation………… Accommodation and Food Services………… Food Serv., Restaurants, Drinking Places… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal Government………………………… State Government……………………………. **Local Government……………………………

1,669,000 260,600 62,800 197,800 146,200 33,800 18,000 15,100 10,800 42,900 29,800 51,600 8,200 17,300 8,200 1,408,400 317,900 65,500 201,600 22,400 16,400 44,300 27,400 50,800 8,800 42,000 38,700 13,900 142,700 122,400 32,200 19,000 66,400 20,300 194,700 87,100 15,400 17,500 27,800 79,800 27,200 270,900 52,800 218,100 54,800 57,400 33,700 130,600 24,600 106,000 94,700 63,800 249,100 20,400 66,300 162,400

0.5 1,664,200 0.7 261,700 1.5 64,800 0.4 196,900 0.3 145,500 2.7 33,400 1.1 18,000 -1.3 15,000 0.9 10,800 -0.2 42,800 -0.7 29,800 0.6 51,400 3.8 8,100 0.6 17,200 2.5 8,300 0.5 1,402,500 0.5 312,400 0.0 65,500 0.4 196,400 0.0 22,600 1.2 15,700 -0.2 44,300 3.0 26,300 1.4 50,500 0.0 8,700 1.7 41,800 -0.8 38,600 -1.4 13,900 -0.7 142,600 -0.8 122,300 -2.7 32,200 7.3 18,800 -1.9 66,500 0.0 20,300 -0.7 195,100 -0.7 86,500 0.7 15,300 -2.8 17,500 0.7 27,800 -1.1 80,800 -0.7 27,300 0.9 270,900 2.9 53,100 0.4 217,800 0.4 54,900 0.3 57,100 0.0 33,700 4.1 129,600 7.0 24,200 3.5 105,400 3.7 94,000 1.6 63,300 -0.4 250,000 -2.4 20,300 -1.5 66,700 0.3 163,000

lTHE CONNECTICUT ECONOMIC DIGEST
12

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *Total excludes workers idled due to labor-management disputes. **Includes Indian tribal government employment.

February 2005

NONFARM EMPLOYMENT ESTIMATES
BRIDGEPORT LMA
DEC 2004 TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… Durable Goods………………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Transportation, Warehousing, & Utilities…… INFORMATION………………………………… FINANCIAL ACTIVITIES……………………… PROFESSIONAL & BUSINESS SERVICES EDUCATIONAL AND HEALTH SERVICES LEISURE AND HOSPITALITY………………… Accommodation and Food Services………… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local…………………………………… 185,500 35,000 6,900 28,100 23,400 150,500 36,500 6,900 24,800 4,800 4,100 14,300 18,800 34,000 14,100 10,900 6,400 22,300 1,700 20,600

LMA

Not Seasonally Adjusted
DEC 2003 186,400 35,900 6,900 29,000 24,200 150,500 36,800 7,000 24,500 5,300 4,200 13,900 19,800 33,200 13,600 10,600 6,500 22,500 1,800 20,700 CHANGE NO. % -900 -900 0 -900 -800 0 -300 -100 300 -500 -100 400 -1,000 800 500 300 -100 -200 -100 -100 -0.5 -2.5 0.0 -3.1 -3.3 0.0 -0.8 -1.4 1.2 -9.4 -2.4 2.9 -5.1 2.4 3.7 2.8 -1.5 -0.9 -5.6 -0.5 NOV 2004 185,000 35,100 6,900 28,200 23,600 149,900 36,000 6,900 24,300 4,800 4,000 14,300 18,800 34,000 14,000 10,900 6,400 22,400 1,700 20,700

For further information on the Bridgeport Labor Market Area contact Arthur Famiglietti at (860) 263-6297.

DANBURY LMA
DEC 2004 TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… INFORMATION………………………………… FINANCIAL ACTIVITIES……………………… PROFESSIONAL & BUSINESS SERVICES EDUCATIONAL AND HEALTH SERVICES LEISURE AND HOSPITALITY………………… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local…………………………………… 92,000 15,700 4,300 11,400 76,300 21,200 3,000 16,300 2,500 4,300 9,300 14,300 7,000 4,300 13,400 700 12,700

Not Seasonally Adjusted
DEC 2003 90,900 16,400 4,100 12,300 74,500 20,600 2,900 15,800 2,700 4,200 9,900 13,500 7,100 4,000 12,500 700 11,800 CHANGE NO. % 1,100 -700 200 -900 1,800 600 100 500 -200 100 -600 800 -100 300 900 0 900 1.2 -4.3 4.9 -7.3 2.4 2.9 3.4 3.2 -7.4 2.4 -6.1 5.9 -1.4 7.5 7.2 0.0 7.6 NOV 2004 91,200 15,700 4,300 11,400 75,500 20,500 3,000 15,600 2,500 4,300 9,400 14,200 6,900 4,300 13,400 700 12,700

For further information on the Danbury Labor Market Area contact Arthur Famiglietti at (860) 263-6297.

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *Total excludes workers idled due to labor-management disputes.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
13

LMA

NONFARM EMPLOYMENT ESTIMATES
HARTFORD LMA
DEC 2004

Not Seasonally Adjusted
DEC 2003 598,700 92,800 20,700 72,100 59,300 14,700 12,800 505,900 105,100 22,600 62,900 19,600 16,000 11,500 72,100 66,100 49,100 60,900 27,600 26,300 89,800 78,300 41,900 34,900 31,800 24,400 100,200 7,400 92,800 CHANGE NO. % -6,000 -5,100 -1,100 -4,000 -3,200 -900 -800 -900 -2,600 100 -2,200 -500 -500 -400 -2,100 -500 -1,000 900 -300 -300 200 500 900 1,600 400 0 2,200 -100 2,300 -1.0 -5.5 -5.3 -5.5 -5.4 -6.1 -6.3 -0.2 -2.5 0.4 -3.5 -2.6 -3.1 -3.5 -2.9 -0.8 -2.0 1.5 -1.1 -1.1 0.2 0.6 2.1 4.6 1.3 0.0 2.2 -1.4 2.5 NOV 2004 592,000 87,800 20,000 67,800 55,800 13,700 12,000 504,200 101,500 22,500 59,800 19,200 15,600 11,200 70,100 65,700 48,100 61,900 27,100 26,400 89,500 78,500 42,600 35,700 32,000 24,300 103,100 7,200 95,900

TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… Durable Goods………………………………… Fabricated Metal……………………………… Non-Durable Goods………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Transportation, Warehousing, & Utilities…… Transportation and Warehousing………… INFORMATION………………………………… FINANCIAL ACTIVITIES……………………… Finance and Insurance……………………… Insurance Carriers & Related Activities…… PROFESSIONAL & BUSINESS SERVICES Professional, Scientific……………………… Administrative and Support………………… EDUCATIONAL AND HEALTH SERVICES Health Care and Social Assistance………… LEISURE AND HOSPITALITY………………… Accommodation and Food Services………… Food Serv., Restaurants, Drinking Places… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local……………………………………

592,700 87,700 19,600 68,100 56,100 13,800 12,000 505,000 102,500 22,700 60,700 19,100 15,500 11,100 70,000 65,600 48,100 61,800 27,300 26,000 90,000 78,800 42,800 36,500 32,200 24,400 102,400 7,300 95,100

For further information on the Hartford Labor Market Area contact Arthur Famiglietti at (860) 263-6297.
Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *Total excludes workers idled due to labor-management disputes.

BUSINESS AND ECONOMIC NEWS

n

New and emerging occupations at the start of the 21st century In 2001, most new and emerging (N&E) occupations (in U.S.) were in establishments with fewer than 100 employees, while the largest establishments accounted for the smallest percentage of N&E occupations. No single industry dominated in the creation and growth of new and emerging occupations; more than one-half were distributed among human services, transportation, communications, business and personal services, and a wide variety of wholesale and retail trade activities. Some of the N&E occupations reported in 2001 included: o Metal stud framer and epoxy floor installer. New building systems, particularly in commercial construction, and increased use of new materials explain the appearance of new occupations in the construction industry. o Distance learning coordinator, home-school liaison, and technology infusion specialist. These workers deal with the use of new telecommunications applications and other technologies to deliver education. o Bill review nurse. Nurses continue to be employed in areas other than those directly related to providing clinical care services. Many of the new jobs for nurses primarily involve controlling medical costs.

--Continued on the following page--

lTHE CONNECTICUT ECONOMIC DIGEST
14

February 2005

NONFARM EMPLOYMENT ESTIMATES
NEW HAVEN LMA
DEC 2004 TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… Durable Goods………………………………… Non-Durable Goods………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Transportation, Warehousing, & Utilities…… INFORMATION………………………………… Telecommunications………………………… FINANCIAL ACTIVITIES……………………… Finance and Insurance……………………… PROFESSIONAL & BUSINESS SERVICES Administrative and Support………………… EDUCATIONAL AND HEALTH SERVICES Educational Services………………………… Health Care and Social Assistance………… LEISURE AND HOSPITALITY………………… Accommodation and Food Services………… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local…………………………………… 257,700 40,300 9,500 30,800 20,200 10,600 217,400 46,800 9,800 29,900 7,100 9,500 6,300 14,100 10,200 25,200 9,400 60,100 22,100 38,000 18,300 15,800 10,600 32,800 5,300 27,500

LMA

Not Seasonally Adjusted
DEC 2003 259,200 40,000 9,600 30,400 20,300 10,100 219,200 46,800 10,400 28,800 7,600 9,400 6,000 13,900 10,200 25,800 11,000 61,100 23,000 38,100 17,800 15,000 10,300 34,100 5,500 28,600 CHANGE NO. % -1,500 300 -100 400 -100 500 -1,800 0 -600 1,100 -500 100 300 200 0 -600 -1,600 -1,000 -900 -100 500 800 300 -1,300 -200 -1,100 -0.6 0.8 -1.0 1.3 -0.5 5.0 -0.8 0.0 -5.8 3.8 -6.6 1.1 5.0 1.4 0.0 -2.3 -14.5 -1.6 -3.9 -0.3 2.8 5.3 2.9 -3.8 -3.6 -3.8 NOV 2004 256,600 40,400 10,000 30,400 19,900 10,500 216,200 45,600 9,900 28,500 7,200 9,600 6,300 14,000 10,100 24,900 9,500 60,500 22,600 37,900 17,900 15,500 10,400 33,300 5,300 28,000

For further information on the New Haven Labor Market Area contact Joseph Slepski at (860) 263-6278.
Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *Total excludes workers idled due to labor-management disputes. **Value less than 50

BUSINESS AND ECONOMIC NEWS (Cont.)

These data are from the Occupational Employment Statistics program. To learn more, see "New and emerging occupations," by Jerome Pikulinski in the December 2004 Monthly Labor Review.
(The Editor's Desk, Bureau of Labor Statistics, January 5, 2005)

n

Experiencing unemployment in 2003 In 2003, the "work-experience unemployment rate" for all workers (in U.S.)--defined as the number unemployed at some time during the year as a proportion of the number who worked or looked for work during the year--was 10.7 percent, down from 11.0 percent in 2002. The 2003 rate is low by historical standards, but is above the series low of 8.6 percent reached in 2000. Among those who experienced unemployment in 2003, the median number of weeks spent looking for work was 16.6 weeks, up from 15.5 weeks the year before. About 2.8 million individuals had looked for a job but did not work at all in 2003, about the same as a year earlier. These data come from the Annual Social and Economic Supplement to the Current Population Survey. For additional information, see "Work Experience of the Population in 2003," news release USDL 04-2532. (The Editor's Desk, Bureau of Labor Statistics, December 29, 2004)

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
15

LMA

NONFARM EMPLOYMENT ESTIMATES
Not Seasonally Adjusted
DEC 2004 DEC 2003 CHANGE NO. % NOV 2004

NEW LONDON LMA

145,400 900 0.6 146,300 TOTAL NONFARM EMPLOYMENT…………… 146,300 GOODS PRODUCING INDUSTRIES………… 24,200 23,900 300 1.3 24,200 4,800 4,600 200 4.3 4,900 CONSTRUCTION, NAT. RES. & MINING.…… 19,400 19,300 100 0.5 19,300 MANUFACTURING…………………………… 12,100 11,900 200 1.7 12,100 Durable Goods………………………………… Non-Durable Goods………………………… 7,300 7,400 -100 -1.4 7,200 122,100 121,500 600 0.5 122,100 SERVICE PROVIDING INDUSTRIES………… 25,900 25,800 100 0.4 25,500 TRADE, TRANSPORTATION, UTILITIES….. 2,300 2,300 0 0.0 2,300 Wholesale Trade……………………………… 19,300 19,200 100 0.5 18,900 Retail Trade…………………………………… 4,300 4,300 0 0.0 4,300 Transportation, Warehousing, & Utilities…… INFORMATION………………………………… 2,400 2,400 0 0.0 2,400 3,800 3,800 0 0.0 3,800 FINANCIAL ACTIVITIES……………………… PROFESSIONAL & BUSINESS SERVICES 10,600 10,500 100 1.0 10,600 EDUCATIONAL AND HEALTH SERVICES 19,600 19,200 400 2.1 19,600 17,200 16,800 400 2.4 17,100 Health Care and Social Assistance………… LEISURE AND HOSPITALITY………………… 14,100 14,300 -200 -1.4 14,300 11,800 12,000 -200 -1.7 12,100 Accommodation and Food Services………… 9,300 9,200 100 1.1 9,400 Food Serv., Restaurants, Drinking Places… OTHER SERVICES…………………………… 4,500 4,300 200 4.7 4,400 41,200 41,200 0 0.0 41,500 GOVERNMENT ………………………………… 2,400 2,500 -100 -4.0 2,400 Federal………………………………………… 38,800 38,700 100 0.3 39,100 **State & Local…………………………………… For further information on the New London Labor Market Area contact Lincoln Dyer at (860) 263-6292.

STAMFORD LMA
DEC 2004 TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Transportation, Warehousing, & Utilities…… INFORMATION………………………………… FINANCIAL ACTIVITIES……………………… Finance and Insurance……………………… PROFESSIONAL & BUSINESS SERVICES Professional, Scientific……………………… Management of Companies………………… Administrative and Support………………… EDUCATIONAL AND HEALTH SERVICES Health Care and Social Assistance………… LEISURE AND HOSPITALITY………………… Accommodation and Food Services………… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local…………………………………… 199,100 16,000 6,200 9,800 183,100 36,600 7,200 24,700 4,700 6,400 28,300 24,100 43,500 17,900 9,800 15,800 23,600 20,200 16,700 10,800 9,100 18,900 1,600 17,300

Not Seasonally Adjusted
DEC 2003 197,900 16,400 6,000 10,400 181,500 36,000 7,400 24,000 4,600 6,500 27,500 23,600 44,800 19,600 10,000 15,200 22,800 19,500 16,100 11,200 9,000 18,800 1,700 17,100 CHANGE NO. % 1,200 -400 200 -600 1,600 600 -200 700 100 -100 800 500 -1,300 -1,700 -200 600 800 700 600 -400 100 100 -100 200 0.6 -2.4 3.3 -5.8 0.9 1.7 -2.7 2.9 2.2 -1.5 2.9 2.1 -2.9 -8.7 -2.0 3.9 3.5 3.6 3.7 -3.6 1.1 0.5 -5.9 1.2 NOV 2004 198,800 16,200 6,400 9,800 182,600 36,200 7,200 24,300 4,700 6,400 27,800 23,800 43,500 17,800 9,900 15,800 23,800 20,400 17,000 10,700 9,000 18,900 1,600 17,300

For further information on the Stamford Labor Market Area contact Joseph Slepski at (860) 263-6278.

lTHE CONNECTICUT ECONOMIC DIGEST
16

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *Total excludes workers idled due to labor-management disputes. **Includes Indian tribal government employment.

February 2005

NONFARM EMPLOYMENT ESTIMATES
WATERBURY LMA
Á

LMA

Not Seasonally Adjusted
DEC 2004 83,000 16,700 3,600 13,100 10,800 66,300 16,400 2,100 11,700 2,600 1,300 3,600 8,600 15,200 14,000 5,600 3,200 12,400 700 11,700 DEC 2003 83,000 16,200 3,400 12,800 10,600 66,800 16,300 2,300 11,300 2,700 1,300 3,500 8,600 15,200 13,900 5,500 3,200 13,200 700 12,500 CHANGE NO. % 0 500 200 300 200 -500 100 -200 400 -100 0 100 0 0 100 100 0 -800 0 -800 0.0 3.1 5.9 2.3 1.9 -0.7 0.6 -8.7 3.5 -3.7 0.0 2.9 0.0 0.0 0.7 1.8 0.0 -6.1 0.0 -6.4 NOV 2004 82,900 16,900 3,700 13,200 10,800 66,000 16,200 2,100 11,500 2,600 1,300 3,600 8,400 14,900 13,700 5,900 3,200 12,500 700 11,800

TOTAL NONFARM EMPLOYMENT…………… GOODS PRODUCING INDUSTRIES………… CONSTRUCTION, NAT. RES. & MINING.…… MANUFACTURING…………………………… Durable Goods………………………………… SERVICE PROVIDING INDUSTRIES………… TRADE, TRANSPORTATION, UTILITIES….. Wholesale Trade……………………………… Retail Trade…………………………………… Transportation, Warehousing, & Utilities…… INFORMATION………………………………… FINANCIAL ACTIVITIES……………………… PROFESSIONAL & BUSINESS SERVICES EDUCATIONAL AND HEALTH SERVICES Health Care and Social Assistance………… LEISURE AND HOSPITALITY………………… OTHER SERVICES…………………………… GOVERNMENT ………………………………… Federal………………………………………… State & Local……………………………………

For further information on the Waterbury Labor Market Area contact Joseph Slepski at (860) 263-6278.

SMALLER LMAS
Á

Not Seasonally Adjusted
DEC 2004 DEC 2003 CHANGE NO. % NOV 2004

TOTAL NONFARM EMPLOYMENT DANIELSON LMA……………………………… LOWER RIVER LMA…………………………… TORRINGTON LMA………………………………

22,400 10,400 28,900

21,600 10,300 28,600

800 100 300

3.7 1.0 1.0

22,300 10,300 29,100

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003. *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: http:// www.ctdol.state.ct.us/lmi/202/covered.htm. 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.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
17

LMA

LABOR FORCE ESTIMATES
EMPLOYMENT STATUS Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate Civilian Labor Force Employed Unemployed Unemployment Rate DEC 2004 1,782,700 1,712,700 70,000 3.9 227,100 216,700 10,400 4.6 119,600 116,500 3,000 2.5 32,000 30,800 1,300 3.9 598,800 572,800 26,000 4.3 13,700 13,300 300 2.5 286,800 275,500 11,300 3.9 167,100 161,300 5,800 3.5 193,600 189,000 4,700 2.4 30,900 29,500 1,400 4.5 117,100 110,900 6,100 5.2 DEC 2003 1,782,900 1,693,900 89,100 5.0 228,400 214,600 13,800 6.0 117,400 113,400 3,900 3.3 35,700 33,800 1,900 5.4 602,600 570,000 32,600 5.4 13,200 12,800 400 3.3 288,200 274,200 14,000 4.9 166,300 158,900 7,400 4.4 192,600 186,400 6,200 3.2 39,700 38,000 1,700 4.4 117,400 109,500 7,900 6.7 CHANGE NO. % -200 0.0 18,800 1.1 -19,100 -21.4 -1.1 ---1,300 -0.6 2,100 1.0 -3,400 -24.6 -1.4 --2,200 1.9 3,100 2.7 -900 -23.1 -0.8 ---3,700 -10.4 -3,000 -8.9 -600 -31.6 -1.5 ---3,800 -0.6 2,800 0.5 -6,600 -20.2 -1.1 --500 3.8 500 3.9 -100 -25.0 -0.8 ---1,400 -0.5 1,300 0.5 -2,700 -19.3 -1.0 --800 0.5 2,400 1.5 -1,600 -21.6 -0.9 --1,000 0.5 2,600 1.4 -1,500 -24.2 -0.8 ---8,800 -22.2 -8,500 -22.4 -300 -17.6 0.1 ---300 -0.3 1,400 1.3 -1,800 -22.8 -1.5 --1,376,000 1,722,000 -346,000 -0.3 0.9 1.2 -4.4 --NOV 2004 1,786,200 1,710,800 75,400 4.2 227,400 216,100 11,300 5.0 118,600 115,300 3,300 2.8 32,000 30,700 1,400 4.3 599,900 572,000 27,900 4.7 13,700 13,300 400 2.6 287,400 275,100 12,300 4.3 168,000 161,800 6,200 3.7 194,700 189,700 5,100 2.6 31,200 29,800 1,400 4.5 117,300 110,800 6,500 5.5 148,246,000 140,581,000 7,665,000 5.2

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CONNECTICUT

BRIDGEPORT LMA

DANBURY LMA

DANIELSON LMA

HARTFORD LMA

LOWER RIVER LMA

NEW HAVEN LMA

NEW LONDON LMA

STAMFORD LMA

TORRINGTON LMA

WATERBURY LMA

UNITED STATES

Civilian Labor Force 147,877,000 146,501,000 Employed 140,278,000 138,556,000 Unemployed 7,599,000 7,945,000 Unemployment Rate 5.1 5.4

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003.

lTHE CONNECTICUT ECONOMIC DIGEST
18

February 2005

MANUFACTURING HOURS AND EARNINGS
CONNECTICUT
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LMA

MANUFACTURING DURABLE GOODS Fabricated Metal Machinery Computer & Electronic Transport. Equipment NON-DUR. GOODS CONSTRUCTION

AVG WEEKLY EARNINGS DEC CHG NOV 2004 2003 Y/Y 2004 $801.13 $765.85 $35.28 $787.92 827.48 791.93 35.54 811.86 736.53 710.05 26.48 742.18 808.96 782.63 26.33 799.57 656.78 606.96 49.82 673.63 1,042.90 1,006.13 36.77 993.72 734.83 700.91 33.91 730.86 911.32 899.90 11.43 894.74

AVG WEEKLY HOURS DEC CHG NOV 2004 2003 Y/Y 2004 42.5 42.5 0.0 42.0 42.5 42.6 -0.1 42.0 43.3 42.8 0.5 43.2 41.4 40.3 1.1 41.3 41.7 40.9 0.8 41.1 42.9 43.2 -0.3 42.0 42.5 42.3 0.2 42.1 39.4 39.4 0.0 38.7

AVG HOURLY EARNINGS DEC CHG NOV 2004 2003 Y/Y 2004 $18.85 $18.02 $0.83 $18.76 19.47 18.59 0.88 19.33 17.01 16.59 0.42 17.18 19.54 19.42 0.12 19.36 15.75 14.84 0.91 16.39 24.31 23.29 1.02 23.66 17.29 16.57 0.72 17.36 23.13 22.84 0.29 23.12

LMAs
MANUFACTURING Bridgeport Danbury Danielson* Hartford Lower River* New Haven New London Stamford* Torrington* Waterbury

AVG WEEKLY EARNINGS DEC CHG NOV 2004 2003 Y/Y 2004 $834.15 $836.40 -$2.25 $812.83 696.01 722.74 -26.73 714.76 889.94 623.42 801.48 841.10 695.63 766.50 48.84 -72.21 34.98 874.66 625.14 794.99

AVG WEEKLY HOURS DEC CHG NOV 2004 2003 Y/Y 2004 41.5 42.5 -1.0 40.1 42.7 43.2 -0.5 42.8 44.1 43.2 42.7 43.1 43.3 42.0 0.9 43.3 -0.4 41.4 1.3 43.3

AVG HOURLY EARNINGS DEC CHG NOV 2004 2003 Y/Y 2004 $20.10 $19.68 $0.42 $20.27 16.30 16.73 -0.43 16.70 20.18 14.60 18.51 19.47 16.14 18.25 0.71 -1.54 0.26 20.20 15.10 18.36

779.22

709.63

69.59

805.91

39.0 39.8

-0.8 39.7

19.98

17.83

2.15

20.30

Current month’s data are preliminary. Prior months’ data have been revised. All data are benchmarked to March 2003.
*Data for the Danielson, Lower River and Torrington labor market areas are no longer being prepared for publication. Manufacturing hours and earnings estimates for the Stamford labor market area will no longer be published due to their not meeting sample reliability tests.

NEW HOUSING PERMITS
Connecticut LMAs: Bridgeport Danbury Danielson Hartford Lower River New Haven New London Stamford Torrington Waterbury DEC 2004 1,002 78 42 28 443 3 73 180 69 32 54 DEC 2003 829 74 66 26 303 2 95 146 56 21 40 CHANGE Y/Y UNITS % 173 20.9 4 -24 2 140 1 -22 34 13 11 14 5.4 -36.4 7.7 46.2 50.0 -23.2 23.3 23.2 52.4 35.0 YTD 2004 2003 11,958 9,985 1,184 925 482 4,461 84 1,374 1,359 1,148 343 598 1,016 759 369 4,176 96 927 1,058 697 289 598 CHANGE YTD UNITS % 1,973 19.8 168 166 113 285 -12 447 301 451 54 0 16.5 21.9 30.6 6.8 -12.5 48.2 28.4 64.7 18.7 0.0 NOV 2004 1,297 71 45 38 436 6 332 84 187 43 55

LMA

Additional data by town are on page 22.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
19

Town

LABOR FORCE ESTIMATES BY TOWN
(By Place of Residence - Not Seasonally Adjusted)

DECEMBER 2004
LMA/TOWNS BRIDGEPORT Ansonia Beacon Falls BRIDGEPORT Derby Easton Fairfield Milford Monroe Oxford Seymour Shelton Stratford Trumbull DANBURY Bethel Bridgewater Brookfield DANBURY New Fairfield New Milford Newtown Redding Ridgefield Roxbury Sherman Washington DANIELSON Brooklyn Eastford Hampton KILLINGLY Pomfret Putnam Scotland Sterling Thompson Union Voluntown Woodstock HARTFORD Andover Ashford Avon Barkhamsted Berlin Bloomfield Bolton Bristol LABOR FORCE 227,130 9,007 2,996 62,238 6,594 3,570 28,285 27,928 10,222 5,451 8,252 20,348 25,056 17,185 119,578 9,917 1,000 8,730 41,263 7,277 15,227 13,244 4,580 13,119 1,162 2,174 1,884 32,049 4,119 971 1251 9471 2402 4697 957 1,820 4,784 444 1,546 4,371 598,781 1,677 2,194 8,154 2,031 9,547 10,050 2,810 31,270 EMPLOYED 216,740 8,532 2,868 57,811 6,262 3,501 27,530 26,804 9,948 5,290 7,938 19,595 23,979 16,683 116,536 9,657 983 8,547 40,112 7,124 14,713 12,925 4,499 12,891 1,135 2,139 1,810 30,799 3,991 956 1,216 8,984 2,339 4,489 944 1,730 4,585 436 1,473 4,242 572,766 1,625 2,127 7,957 1,942 9,223 9,545 2,747 29,749 UNEMPLOYED 10,390 475 128 4,427 332 69 755 1,124 274 161 314 753 1,077 502 3,042 260 17 183 1,151 153 514 319 81 228 27 35 74 1,250 128 15 35 487 63 208 13 90 199 8 73 129 26,015 52 67 197 89 324 505 63 1,521 % 4.6 5.3 4.3 7.1 5.0 1.9 2.7 4.0 2.7 3.0 3.8 3.7 4.3 2.9 2.5 2.6 1.7 2.1 2.8 2.1 3.4 2.4 1.8 1.7 2.3 1.6 3.9 3.9 3.1 1.5 2.8 5.1 2.6 4.4 1.4 4.9 4.2 1.8 4.7 3.0 4.3 3.1 3.1 2.4 4.4 3.4 5.0 2.2 4.9 LMA/TOWNS HARTFORD cont.... Burlington Canton Chaplin Colchester Columbia Coventry Cromwell Durham East Granby East Haddam East Hampton East Hartford East Windsor Ellington Enfield Farmington Glastonbury Granby Haddam HARTFORD Harwinton Hebron Lebanon Manchester Mansfield Marlborough Middlefield Middletown New Britain New Hartford Newington Plainville Plymouth Portland Rocky Hill Simsbury Somers Southington South Windsor Stafford Suffield Tolland Vernon West Hartford Wethersfield Willington Winchester Windham Windsor Windsor Locks LABOR FORCE 4,590 4,912 1,198 7,467 2,708 6,314 6,920 3,523 2,597 4,476 7,336 25,746 5,421 7,600 23,001 12,123 16,754 5,624 4,048 50,122 2,850 4,588 3,609 28,498 9,741 3,048 2,226 23,177 33,751 3,468 15,493 9,228 6,109 4,576 10,109 11,891 4,351 21,323 13,873 5,586 6,833 7,567 15,587 28,295 12,272 3,387 5,582 10,474 14,476 6,601 EMPLOYED 4,445 4,764 1,136 7,179 2,623 6,117 6,667 3,444 2,522 4,326 7,106 24,367 5,165 7,329 22,105 11,839 16,378 5,466 3,964 45,617 2,734 4,443 3,483 27,362 9,551 2,944 2,165 22,230 31,303 3,340 14,929 8,829 5,812 4,416 9,778 11,609 4,219 20,509 13,494 5,332 6,620 7,375 14,937 27,486 11,821 3,294 5,211 9,880 13,877 6,308 UNEMPLOYED 145 148 62 288 85 197 253 79 75 150 230 1,379 256 271 896 284 376 158 84 4,505 116 145 126 1,136 190 104 61 947 2,448 128 564 399 297 160 331 282 132 814 379 254 213 192 650 809 451 93 371 594 599 293 % 3.2 3.0 5.2 3.9 3.1 3.1 3.7 2.2 2.9 3.4 3.1 5.4 4.7 3.6 3.9 2.3 2.2 2.8 2.1 9.0 4.1 3.2 3.5 4.0 2.0 3.4 2.7 4.1 7.3 3.7 3.6 4.3 4.9 3.5 3.3 2.4 3.0 3.8 2.7 4.5 3.1 2.5 4.2 2.9 3.7 2.7 6.6 5.7 4.1 4.4

LABOR FORCE CONCEPTS The civilian labor force comprises all state residents age 16 years and older classified as employed or unemployed in accordance with criteria described below. Excluded are members of the military and persons in institutions (correctional and mental health, for example).

The employed are all persons who did any work as paid employees or in their own business during the survey week, or who have worked 15 hours or more as unpaid workers in an enterprise operated by a family member. Persons temporarily absent from a job because of illness, bad weather, strike or for personal reasons are also counted as employed whether they were paid by their employer or were seeking other jobs. The unemployed are all persons who did not work, but were available for work during the survey week (except for temporary illness) and made specific efforts to find a job in the prior four weeks. Persons waiting to be recalled to a job from which they had been laid off need not be looking for work to be classified as unemployed.

lTHE CONNECTICUT ECONOMIC DIGEST
20

February 2005

LABOR FORCE ESTIMATES BY TOWN
(By Place of Residence - Not Seasonally Adjusted)

Town

DECEMBER 2004
LMA/TOWNS LOWER RIVER Chester Deep River Essex Lyme Westbrook NEW HAVEN Bethany Branford Cheshire Clinton East Haven Guilford Hamden Killingworth Madison MERIDEN NEW HAVEN North Branford North Haven Orange Wallingford West Haven Woodbridge *NEW LONDON Bozrah Canterbury East Lyme Franklin Griswold Groton Ledyard Lisbon Montville NEW LONDON No. Stonington NORWICH Old Lyme Old Saybrook Plainfield Preston Salem Sprague Stonington Waterford LABOR FORCE 13,673 2,201 2,770 3,734 1,194 3,774 286,835 2,993 16,743 14,689 7,475 15,573 12,189 31,289 3,308 9,337 30,855 57,532 8,128 12,873 6,929 24,034 28,427 4,464 148,829 1,578 2,925 10,826 1,213 6,198 17,741 8,507 2,475 11,802 13,594 3,089 20,014 4,498 6,387 8,500 2,731 2,417 1,783 10,995 11,557 EMPLOYED 13,327 2,141 2,703 3,638 1,172 3,673 275,535 2,910 16,248 14,309 7,238 14,869 11,934 30,247 3,221 9,099 29,312 54,215 7,839 12,471 6,783 23,198 27,266 4,376 143,699 1,525 2,803 10,571 1,174 5,942 17,078 8,302 2,412 11,457 12,891 3,011 19,057 4,403 6,238 8,106 2,659 2,356 1,686 10,810 11,219 UNEMPLOYED 346 60 67 96 22 101 11,300 83 495 380 237 704 255 1,042 87 238 1,543 3,317 289 402 146 836 1,161 88 5,130 53 122 255 39 256 663 205 63 345 703 78 957 95 149 394 72 61 97 185 338 % 2.5 2.7 2.4 2.6 1.8 2.7 3.9 2.8 3.0 2.6 3.2 4.5 2.1 3.3 2.6 2.5 5.0 5.8 3.6 3.1 2.1 3.5 4.1 2.0 3.4 3.4 4.2 2.4 3.2 4.1 3.7 2.4 2.5 2.9 5.2 2.5 4.8 2.1 2.3 4.6 2.6 2.5 5.4 1.7 2.9 LMA/TOWNS STAMFORD Darien Greenwich New Canaan NORWALK STAMFORD Weston Westport Wilton TORRINGTON Canaan** Colebrook Cornwall Goshen Hartland Kent** Litchfield Morris Norfolk North Canaan** Salisbury** Sharon** TORRINGTON Warren WATERBURY Bethlehem Middlebury Naugatuck Prospect Southbury Thomaston WATERBURY Watertown Wolcott Woodbury LABOR FORCE 193,619 9,755 31,020 9,552 48,639 66,287 5,137 14,262 8,966 30,860 739 849 829 1,563 1,061 2,014 4,303 1,280 911 2,226 2,433 2,102 19,393 671 117,080 1,999 3,511 16,690 4,900 7,530 4,187 52,406 11,976 8,581 5,300 EMPLOYED 188,956 9,594 30,474 9,427 47,138 64,405 5,068 14,020 8,829 29,478 723 839 808 1,525 1,034 1,976 4,158 1,238 875 2,176 2,386 2,081 18,349 652 110,945 1,942 3,414 15,898 4,714 7,254 3,998 48,838 11,489 8,248 5,151 UNEMPLOYED 4,663 161 546 125 1,501 1,882 69 242 137 1,382 16 10 21 38 27 38 145 42 36 50 47 21 1,044 19 6,135 57 97 792 186 276 189 3,568 487 333 149 % 2.4 1.7 1.8 1.3 3.1 2.8 1.3 1.7 1.5 4.5 2.2 1.2 2.5 2.4 2.5 1.9 3.4 3.3 4.0 2.2 1.9 1.0 5.4 2.8 5.2 2.9 2.8 4.7 3.8 3.7 4.5 6.8 4.1 3.9 2.8

Not Seasonally Adjusted: CONNECTICUT 1,782,700 UNITED STATES 147,877,000 Seasonally Adjusted: CONNECTICUT UNITED STATES

1,712,700 140,278,000

70,000 7,599,000

3.9 5.1

1,797,400 148,203,000

1,719,600 140,156,000

77,800 8,047,000

4.3 5.4

*Connecticut portion only. For whole MSA, including Rhode Island towns, see below. NEW LONDON 167,121 161,304 5,817 3.5 Hopkinton, RI 4,729 4,535 194 4.1 Westerly, RI 13,563 13,070 493 3.6

**The Bureau of Labor Statistics has identified these fiv e tow ns as a separate area to report labor force data. For the conv enience of our data users, data for these tow ns are included in the Torrington LMA. For the same purpose, data for the tow n of Thompson, w hich is officially part of the Worcester, MA MSA, is included in the Danielson LMA.

LABOR FORCE CONCEPTS (Continued) The unemployment rate represents the number unemployed as a percent of the civilian labor force.

With the exception of those persons temporarily absent from a job or waiting to be recalled to one, persons with no job and who are not actively looking for one are counted as "not in the labor force". Over the course of a year, the size of the labor force and the levels of employment undergo fluctuations due to such seasonal events as changes in weather, reduced or expanded production, harvests, major holidays and the opening and closing of schools. Because these seasonal events follow a regular pattern each year, their influence on statistical trends can be eliminated by adjusting the monthly statistics. Seasonal Adjustment makes it easier to observe cyclical and other nonseasonal developments.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
21

Town

HOUSING PERMIT ACTIVITY BY TOWN
DEC YR TO DATE 2004 2004 2003 1 23 13 0 16 21 2 29 25 9 95 157 1 17 15 2 26 17 6 84 91 2 36 35 0 32 76 0 7 9 9 1 0 5 17 1 149 6 5 5 0 1 17 2 2 1 0 9 0 2 1 5 3 5 8 0 0 3 2 1 5 1 3 3 12 2 0 7 6 1 8 2 0 8 4 7 9 121 15 12 44 139 8 263 78 53 54 2 22 147 23 61 12 46 83 9 32 12 49 57 398 157 14 15 46 20 53 158 12 46 80 96 23 7 74 57 19 170 126 7 113 55 72 157 313 7 11 34 86 5 140 77 44 65 3 32 94 17 41 11 44 89 5 42 9 58 70 176 115 7 14 49 27 61 144 6 64 80 53 14 8 122 50 32 83 115 11 74 44 57 146 TOWN Griswold Groton Guilford Haddam Hamden Hampton Hartford Hartland Harwinton Hebron Kent Killingly Killingworth Lebanon Ledyard Lisbon Litchfield Lyme Madison Manchester Mansfield Marlborough Meriden Middlebury Middlefield Middletown Milford Monroe Montville Morris Naugatuck New Britain New Canaan New Fairfield New Hartford New Haven New London New Milford Newington Newtown Norfolk North Branford North Canaan North Haven North Stonington Norwalk Norwich Old Lyme Old Saybrook Orange Oxford Plainfield Plainville Plymouth Pomfret Portland DEC YR TO DATE 2004 2004 2003 2 73 51 9 269 162 3 72 82 7 70 51 2 39 55 2 28 20 35 206 174 0 10 6 2 30 19 4 37 39 2 2 0 3 4 1 8 1 3 13 8 2 9 7 1 19 14 1 6 0 12 0 12 2 5 31 113 6 0 11 0 4 1 2 3 19 20 2 2 2 17 3 0 5 1 5 16 88 23 78 75 19 55 6 45 163 55 41 323 70 9 227 286 27 79 8 95 32 67 42 46 255 152 116 40 137 5 57 11 75 32 301 220 32 43 29 216 49 37 57 25 139 13 84 28 42 80 18 29 12 42 106 51 46 97 42 14 203 283 32 93 4 66 39 57 29 47 77 52 136 48 141 7 40 7 57 23 130 128 29 25 48 141 53 46 28 32 55 TOWN Preston Prospect Putnam Redding Ridgefield Rocky Hill Roxbury Salem Salisbury Scotland Seymour Sharon Shelton Sherman Simsbury Somers South Windsor Southbury Southington Sprague Stafford Stamford Sterling Stonington Stratford Suffield Thomaston Thompson Tolland Torrington Trumbull Union Vernon Voluntown Wallingford Warren Washington Waterbury Waterford Watertown West Hartford West Haven Westbrook Weston Westport Wethersfield Willington Wilton Winchester Windham Windsor Windsor Locks Wolcott Woodbridge Woodbury Woodstock DEC YR TO DATE 2004 2004 2003 1 20 21 9 40 23 5 53 14 3 21 32 4 46 44 2 86 79 1 14 16 6 36 24 0 12 15 1 15 9 3 0 12 2 0 1 5 9 10 1 2 8 3 3 1 5 0 4 4 15 3 0 16 1 2 1 1 6 0 4 0 2 0 3 8 0 2 2 1 4 3 4 4 1 3 2 39 21 132 24 85 39 196 109 180 10 70 290 53 94 44 70 35 44 87 112 67 4 190 12 185 15 9 71 35 63 39 24 33 17 122 8 26 37 36 21 83 59 65 14 43 84 46 11 85 20 24 45 171 119 195 9 57 96 39 105 65 80 23 33 95 123 135 3 191 18 133 13 7 138 51 47 45 26 34 12 114 19 20 27 48 22 71 52 79 24 52 59

TOWN Andover Ansonia Ashford Avon Barkhamsted Beacon Falls Berlin Bethany Bethel Bethlehem Bloomfield Bolton Bozrah Branford Bridgeport Bridgewater Bristol Brookfield Brooklyn Burlington Canaan Canterbury Canton Chaplin Cheshire Chester Clinton Colchester Colebrook Columbia Cornwall Coventry Cromwell Danbury Darien Deep River Derby Durham East Granby East Haddam East Hampton East Hartford East Haven East Lyme East Windsor Eastford Easton Ellington Enfield Essex Fairfield Farmington Franklin Glastonbury Goshen Granby Greenwich

For further information on the housing permit data, contact Kolie Sun of DECD at (860) 270-8167.

lTHE CONNECTICUT ECONOMIC DIGEST
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February 2005

TECHNICAL NOTES
BUSINESS STARTS AND TERMINATIONS Registrations and terminations of business entities as recorded with the Secretary of the State and the Connecticut Department of Labor (DOL) are an indication of new business formation and activity. DOL business starts include new employers which have become liable for unemployment insurance taxes during the quarter, as well as new establishments opened by existing employers. DOL business terminations are those accounts discontinued due to inactivity (no employees) or business closure, and accounts for individual business establishments that are closed by still active employers. The Secretary of the State registrations include limited liability companies, limited liability partnerships, and foreignowned (out-of-state) and domestic-owned (in-state) corporations. CONSUMER PRICE INDEX The Consumer Price Index (CPI), computed and published by the U.S. Bureau of Labor Statistics, is a measure of the average change in prices over time in a fixed market basket of goods and services. It is based on prices of food, clothing, shelter, fuels, transportation fares, charges for doctors’ and dentists’ services, drugs and other goods and services that people buy for their day-to-day living. The Northeast region is comprised of the New England states, New York, New Jersey and Pennsylvania. EMPLOYMENT COST INDEX The Employment Cost Index (ECI) covers both wages and salaries and employer costs for employee benefits for all occupations and establishments in both the private nonfarm sector and state and local government. The ECI measures employers’ labor costs free from the influences of employment shifts among industries and occupations. The base period for all data is June 1989 when the ECI is 100. HOURS AND EARNINGS ESTIMATES Production worker earnings and hours estimates include full- and part-time employees working within manufacturing industries. Hours worked and earnings data are computed based on payroll figures for the week including the 12th of the month. Average hourly earnings are affected by such factors as premium pay for overtime and shift differential as well as changes in basic hourly and incentive rates of pay. Average weekly earnings are the product of weekly hours worked and hourly earnings. These data are developed in cooperation with the U.S. Department of Labor, Bureau of Labor Statistics. INDIAN GAMING DATA Indian Gaming Payments are amounts received by the State as a result of the slot compact with the two Federally recognized tribes in Connecticut, which calls for 25 percent of net slot receipts to be remitted to the State. Indian Gaming Slots are the total net revenues from slot machines only received by the two Federally recognized Indian tribes. INITIAL CLAIMS Average weekly initial claims are calculated by dividing the total number of new claims for unemployment insurance received in the month by the number of weeks in the month. A minor change in methodology took effect with data published in the March 1997 issue of the DIGEST. Data have been revised back to January 1980. INSURED UNEMPLOYMENT RATE Primarily a measure of unemployment insurance program activity, the insured unemployment rate is the 13-week average of the number of people claiming unemployment benefits divided by the number of workers covered by the unemployment insurance system. LABOR FORCE ESTIMATES Labor force estimates are a measure of the work status of people who live in Connecticut. Prepared under the direction of the U.S. Bureau of Labor Statistics, the statewide estimates are the product of a multiple variable coefficient regression model, which uses results from the Current Population Survey (CPS), a monthly survey of Connecticut households, counts of claimants for unemployment benefits, and establishment employment estimates. Due to the small size of the sample taken in Connecticut, the CPS results are subject to significant sampling error and produce considerable month-to-month fluctuations in estimates derived from the sample. In general, the CPS estimates, at the 90 percent confidence level, have an error range of about 1.5 percentage points on a rate of 6.0 percent. An accepted method for calculating the error range for model estimates is currently not available. Labor force data, reflecting persons employed by place of residence, are not directly comparable to the place-of-work industry employment series. In the labor force estimates, workers involved in labor disputes are counted as employed. The labor force data also includes agricultural workers, unpaid family workers, domestics and the self-employed. Because of these conceptual differences, total labor force employment is almost always different from nonfarm wage and salary employment. LABOR MARKET AREAS All Labor Market Areas in Connecticut except three are federally designated areas for developing labor statistics. Industry employment data for the Danielson, Lower River and Torrington Labor Market Areas are prepared exclusively by the Connecticut Department of Labor, following the same statistical procedures used to prepare estimates for the other Labor Market Areas, which are developed in cooperation with the U.S. Department of Labor, Bureau of Labor Statistics. The Bureau of Labor Statistics has identified the five towns of Canaan, Kent, North Canaan, Salisbury and Sharon as a separate area for reporting labor force data. For the convenience of our data users, data for these towns are included in the Torrington Labor Market Area. For the same purpose, data for the town of Thompson, which is officially part of the Worcester Metropolitan Statistical Area, are included in the Danielson Labor Market Area. Also, data for Hopkinton and Westerly, Rhode Island are included in the New London Labor Market Area. LEADING AND COINCIDENT EMPLOYMENT INDICES The leading employment index is a composite of six individual largely employment-related series -- the average workweek of manufacturing production and construction workers, Hartford help-wanted advertising index, short-duration (less than 15 weeks) unemployment rate, initial claims for unemployment insurance, total housing permits, and Moody's BAA corporate bond yield. While not employment-sector variables, housing permits are closely related to construction employment and the corporate bond yield adds important information about the movement in interest rates. The coincident employment index is a composite indicator of four individual employment-related series -- the total unemployment rate, nonfarm employment (employer survey), total employment (state residents employed measured by a household survey), and the insured unemployment rate. All data are seasonally adjusted and come from the Connecticut Labor Department, the Federal Reserve Bank of Boston, and the Board of Governors of the Federal Reserve System. NONFARM EMPLOYMENT ESTIMATES Nonfarm employment estimates are derived from a survey of businesses to measure jobs by industry. The estimates include all full- and parttime wage and salary employees who worked during or received pay for the pay period which includes the 12th of the month. Excluded from these estimates are proprietors, self-employed workers, private household employees and unpaid family workers. In some cases, due to space constraints, all industry estimates are not shown. Call (860) 263-6275 for a more comprehensive breakout of nonfarm employment estimates. These data are developed in cooperation with the U.S. Department of Labor, Bureau of Labor Statistics. UI COVERED WAGES UI covered wages is the total amount paid to those employees who are covered under the Connecticut’s Unemployment Insurance (UI) law for services performed during the quarter. The fluctuations in the 1992-93 period reflect the effect of the changes in the tax law and the massive restructuring in the state’s economy.

February 2005

THE CONNECTICUT ECONOMIC DIGEST

l
23

ECONOMIC INDICATORS AT A GLANCE
(Percent change from prior year; see pages 5-8 for reference months or quarters)
Leading Employment Index .......... +1.0 Coincident Employment Index ...... +1.5 Leading General Drift Indicator ..... +1.8 Coincident General Drift Indicator . -0.3 Banknorth Business Barometer ... +2.0 Total Nonfarm Employment .......... +0.5 Unemployment ................................ -1.2 Labor Force ..................................... 0.0 Employed ....................................... +1.2 Unemployed ................................. -20.9 Average Weekly Initial Claims ...... -13.8 Help Wanted Index -- Hartford ..... +10.0 Average Ins. Unempl. Rate .......... -0.68* Average Weekly Hours, Mfg ............ 0.0 Average Hourly Earnings, Mfg ...... +4.6 Average Weekly Earnings, Mfg ..... +4.6 CT Mfg. Production Index .............. +6.9 Production Worker Hours ............... +1.4 Industrial Electricity Sales .............. +6.8 Personal Income ............................ +4.9 UI Covered Wages ......................... +5.3 Business Activity New Housing Permits .................. +20.9 Electricity Sales .............................. +0.3 Retail Sales .................................... -0.6 Construction Contracts Index ........ -11.1 New Auto Registrations ................... -7.5 Air Cargo Tons ............................... +5.8 Exports ........................................... -4.8 Tourism and Travel Info Center Visitors ...................... +19.6 Attraction Visitors ........................... +3.3 Air Passenger Count ...................... +9.2 Indian Gaming Slots ....................... +8.8 Travel and Tourism Index ............... -1.0 Employment Cost Index (U.S.) Total .............................................. +3.8 Wages & Salaries .......................... +2.4 Benefit Costs ................................. +6.9 Consumer Prices Connecticut ...................................... NA U.S. City Average .......................... +3.3 Northeast Region ........................... +3.6 NY-NJ-Long Island ......................... +3.8 Boston-Brockton-Nashua ............... +2.5 Consumer Confidence Connecticut .................................. +40.6 New England ............................... +13.2 U.S. ............................................... +7.9 Interest Rates Prime .......................................... +1.14* Conventional Mortgage ................ -0.13*

Business Starts Secretary of the State .................... +0.9 Dept. of Labor ................................. -2.2 Business Terminations Secretary of the State ................... -10.6 Dept. of Labor ............................... -28.2

State Revenues ............................ +13.5 Corporate Tax ............................... +66.1 Personal Income Tax .................... +15.1 Real Estate Conveyance Tax ........ +53.9 Sales & Use Tax ............................. +5.5 Indian Gaming Payments .............. +10.9
*Percentage point change; **Less than 0.05 percent; NA = Not Available

THE CONNECTICUT ECONOMIC DIGEST
THE CONNECTICUT

February 2005
We would appreciate your input:
o What article topics would you like to see covered in future issues? o What additional data would you like to see included in the Digest? Please send your comments, questions, and suggestions regarding the Digest to [email protected] Thank you!

ECONOMIC DIGEST
A joint publication of The Connecticut Departments of Labor and Economic and Community Development

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