A new forecast from UConn economists says the state may be fortunate to hold job losses below 100,000 as the recession continues.
Connecticut and the nation stand at a fork in the road according to this latest study from the Connecticut Center for Economic Analysis. If the stimulus initiatives set in motion by the federal government begin to take hold, employment losses in the state should peak at 100,000 by the middle of next year, and then see a recovery. If the recession proves unresponsive to the government’s efforts, job loss is forecast to continue beyond 110,000, and into the following year, 2011.
Senior Research Fellow Peter Gunther says there’s also an important international dimension to forecasting a recovery.
"When you look at the root cause of the decline in the gross domestic product, for the first quarter, about half of that is the drop in exports from the United States to the rest of the world. The kind of recovery that’s going to be needed is not just recovery in the United States, it’s worldwide."
The outlook authors say the state faces the challenge of developing a coherent and effective economic development strategy, accompanied by significant strategic investments, even as it faces a budget emergency.