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UConn Report Says Fiscal Cliff Could be 'Disastrous' For Connecticut

The university's quarterly state economic outlook is grim.

Connecticut lost 5,700 jobs in the second and third quarters of 2012, unemployment surged and the state budget is headed for a more than $1 billion deficit for next year.

In short, Connecticut’s economy overall remained wobbly in 2012, a new report from the University of Connecticut shows, and it appears it won’t be making much of a comeback anytime soon.

“The only breaks Connecticut’s economy seems to catch these days are bad ones,” the introduction to this quarter’s The Connecticut Economy states. “Unemployment surged even as potential workers appeared to leave the labor force in droves. Cracks began appearing in what had been a rock-solid state budget. And the jobs forecast for 2013 remains tepid at best.”

To make matters worse, the report later goes on to say, Congress seems deadlocked on solving the nation’s financial woes and could end up going over the so-called “fiscal cliff” by year’s end, a situation that would hurt Connecticut’s economy even more.

“The consequences for Connecticut employment would be disastrous” if Congress doesn’t avoid the fiscal cliff, the report says. “The state could lose as many as 20,000 jobs before growth returned in 2014, with losses peaking at 5,000 in 2013-Q2. And that’s not even counting the possible defense-related job cuts a sequestration might trigger.”

There are some bright spots in the report, however. If the federal government can avoid going over the fiscal cliff Connecticut could begin to see job gains of more than 3,000 or more per quarter next year and the decline of manufacturing in Connecticut appears to be at an end, the report states.

Spiff December 13, 2012 at 06:40 PM
Well, if the voters of this state would stop electing politicians like Dan Malloy that actually hurt us middle class citizens (by signing the largest tax increase in CT history, creating a business unfriendly political environment, etc., etc., etc.), then maybe our state economy wouldn't be one of the worst in the country (unemployment rate of 9% vs. a national rate below 8%). There are many parts of the country that were virtually untouched by the recent recession (the Houston and Philadelphia metropolitan areas for example). CT is ranked as one of the most business unfriendliest states in the country and, unfortunately, this is due to the fact that we continue to elect these politicians who don't have a clue how to positively influence the economy! Please access links below. http://finance.yahoo.com/news/pf_article_113611.html http://www.cnbc.com/id/100016697 http://truthinaccounting.org/state-of-states/
Tom December 28, 2012 at 05:33 PM
hate to say it but the best thing that could happen to this country would be if we go head and heels over the fiscal cliff. time to pay the piper now it will only get worse and more difficult to fix down the road. time that people in this state realize that the problem is with spending and that not taxaes.

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