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Connecticut Economic Digest: August 1998 issue
Profiles Of The Workforce, 1986 And 1996 | Industry Clusters | Housing Update | Connecticut Economy Continues To Throw A Party!

Profiles Of The Workforce, 1986 And 1996
By J. Charles Joo, Research Analyst

Every year, the U.S. Bureau of Labor Statistics (BLS) provides a great deal of detailed data on the characteristics of Connecticut's workforce in the publication called Geographic Profile of Employment and Unemployment, which is based on annual average data from the Current Population Survey (CPS). Below are some of the findings for 1996, the latest year available, along with some comparisons from ten years earlier.

Connecticut Workforce

In 1996, nearly seven of every ten (68.2%) Connecticut residents, 16 years and older, participated in the labor force. By comparison, the U.S. and New England labor force participation rates were slightly lower at 66.8% and 68.1%, respectively. While this was an increase for the nation (from 65.3%) and New England (from 68.0%) since 1986, Connecticut's participation rate actually fell from 69.9% a decade earlier.

As the chart below shows, the largest portion of the workforce in 1986, was employed in the administrative support (including clerical) occupational group, making up 17.3% of all workers. Ten years later, however, this shifted to 17.7% of the total employed persons working in the executive, administrative, and managerial occupational group. The professional specialty category saw an increase in its job share from 14.9% to 17.6% between 1986 and 1996. Other occupational groups with increases in employment share included technicians and related support, and service. Those with a decline in employment share between the two periods were administrative support (including clerical); precision production, craft, and repair; and operators, fabricators, and laborers. This supports the common belief that today's economy is moving toward hiring more educated and highly skilled workers, while persons with less education and skill are facing more limited job prospects.

The data further confirm that Connecticut workers shifted from manufacturing jobs to service jobs over the decade, as the percentage of workers in manufacturing declined from 26.2% to 17.7%. The services industries now employ more than one of every four workers (27% in 1996), while nearly the same percentage of workers can be found in wholesale and retail trade (17.3%) as in manufacturing.

Women In The Workforce

From 1986 to 1996, the composition of Connecticut's labor force has changed as women have entered the workforce in increasing numbers. Chart below shows that their participation rate increased from 60.8% in 1986 to 62.5% in 1996 as a consequence of socioeconomic changes such as the rise of single-parent households and the decline in buying power over the last decade. By contrast, men's participation rate decreased from 80.0% to 74.5% over the same period.

As more women entered the labor force, many were drawn to part-time jobs. In 1996, almost one third (31.1%) of working females worked part time, while this was the case for only 11.8% of men (chart below). About 36% of the women cited seasonal work, job started or ended, own illness, child-care problems, other family or personal obligations, labor dispute, in school or training, and civic or military duty as reasons for working part time. Many women worked in the services and trade sectors, where part-time positions are plentiful. In 1996, more than a third of women worked in the services industry, and almost 17% in the trade sector. For men, despite the overall decline, almost one in four were still employed in manufacturing in 1996.

Although many women still worked in the administrative support (including clerical) and service occupations in 1996, nearly one in five females also worked in the professional field, which was a higher proportion than men in the same field. Even more women were employed in management positions than previously, rising in employment share from 11.6% in 1986 to 16.2% in 1996, as their share in the sales and administrative support occupations declined. A greater proportion of women workers entered technical fields than ten years earlier as well, as men's share in that field actually declined over the same time.

A Diverse Workforce

Blacks and Hispanics now make up a larger share of the working-age population than they did ten years ago. They constituted 6% and 3%, respectively, of the total labor force in 1986. By 1996, the figures had grown to 10% for blacks and 5% for Hispanics. The number of whites in the labor force, on the other hand, shrank from 93% in 1986 to 88% in 1996 (detail for race and Hispanic- origin groups will not add to totals because data for the "other races" group are not presented and Hispanics are included in both the white and black population groups). These figures show that minorities have undoubtedly become a significant part of State's workforce. Indeed, the number of blacks and Hispanics working full time grew dramatically, by almost 50% each over the decade, while the number working part-time doubled.

In 1986, the managerial and professional fields employed the greatest percentage of whites, while the largest percentage of blacks held jobs in the administrative support, including clerical category. But a decade later, greater proportions of blacks were working in service occupations, and their share of workers in the managerial and professional specialty group was on the increase. The number of Hispanics who worked in the precision production field fell dramatically from 17.1% in 1986 to 6.8% in 1996. They also moved in greater numbers to service and professional jobs. In fact, a higher proportion of Hispanic than black workers was employed in the professional field in 1996.

Involuntary Part-Timers

Connecticut had a total of 40,000 involuntary parttime workers in 1996. These are persons who work part time for economic reasons which include: slack work or unfavorable business conditions, inability to find full-time work, and seasonal declines in demand. Men had a larger share of involuntary part-time workers (17.2%) than women did (9.1%) in 1996. Almost one in four (22.6%) blacks worked as involuntary part-timers, while this was the case for 16.7% of those of Hispanic origin. Among whites, 10.4% said they had to work part time involuntarily.

Hours Of Work

In 1996, out of those who usually worked full time, the biggest reason for working less than 35 hours a week was due to weather-related curtailments (32%). For workers who usually worked part time, the major factor for working less than 35 hours was attributed to other family or personal obligations (28%). This was especially the case for women (37%), whereas four out of every ten men said that being in school or training caused them to work less hours. For those not at work, over half of the persons with a job said they were on vacation at the time of the survey. About 23% cited their own illnesses as reason for not being at work in 1996.

Unemployment

Any comparison of unemployment in the years 1986 and 1996 needs to consider the difference in economic conditions in the two years. In 1986, Connecticut was in the midst of an economic boom. The State had a very low unemployment rate of 3.8%, compared to 5.7% in 1996. Unemployment rates were higher in 1996 than in 1986 among all population groups. Joblessness for blacks was 14.4% in 1996, compared with 6.3% in 1986. The Hispanic labor force had 17.3% who were unemployed, up from 10.7% in 1986. White women experienced the lowest rate of 4.6% in 1996; white men had the lowest rate, 3.4%, ten years earlier.

Those who involuntarily lost jobs made up over half (52.7%) of the total number of unemployed persons in 1996. Reentrants, who previously worked but were out of the labor force prior to beginning their job search, made up 30.5% of the total unemployed. The biggest change that occurred between 1986 and 1996 was a significant decline in the proportion of voluntary job leavers, from 20.4% to 9.7%, suggesting a much tighter job market and less job security in 1996 than in 1986.

In 1986, almost half (46.9%) of the total unemployed experienced jobless spells lasting less than 5 weeks. In contrast, despite the recovery from the recession of the early '90s, the 1996 unemployment rate was significantly higher at 5.7%. That translated to only a third (30.6%) being unemployed for less than 5 weeks. About 23.5% remained unemployed for more than 15 weeks in 1986, whereas people in this category represented 36.6% of the unemployed in 1996. Of these long-term unemployed, 18.8% were without a job for more than 27 weeks, compared to 13.6% back in 1986. Moreover, one out of every ten unemployed persons in 1996 had been looking for a job for over a year.

The above shows just some of the many findings on characteristics of the labor force published annually in Geographic Profile of Employment and Unemployment. This publication is available from the Bureau of Labor Statistics Publication Center in Chicago, phone number: (312) 353-1880. The 1996 annual averages are contained in the most recent edition, Bulletin 2498.


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Industry Clusters
Bio-Tech Cluster Advances

Biotechnology is a growth industry in Connecticut. The emergence of this cluster is a prime example of the cluster concept: groups of industries that create products or services related by a common technology, market, or need, and the firms that support them.

Connecticut offers proximity to three major research centers critical to biotech. Yale, especially its Medical Center, is one of the top-funded research institutions in the U.S. The University of Connecticut Health Center and its Schools of Medicine and Dental Medicine in Farmington plus the Storrs campus receive total research funding in excess of $112 million per year. Potential exists at Avery Point and Stamford.

As home to four major pharmaceutical companies, namely, Bayer, Pfizer, Bristol Myers Squibb, and Boehringer Ingelheim, Connecticut is also the headquarters of several new and established bio-technology firms: Alexion, CuraGen, Genaissance, Image Content Technologies, Institute for Pharmaceutical Discovery, Neurogen, Protein Sciences Corporation, Sea-Free Fish Company, Vion Pharmaceuticals, and Xicon Technologies. Employment in SIC 283 (pharmaceuticals) and SIC 384 (medical devices) now tops 17,000.

Another example of this cluster's strength is the publicprivate partnership with Pfizer. A $216 million investment by Pfizer in new laboratory/office space in New London will create about 2,000 new jobs.

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Housing Update
June Housing Permits Up 35.8%

Commissioner James F. Abromaitis of the Connecticut Department of Economic and Community Development announced that Connecticut communities authorized 1,203 new housing units in June 1998, a 35.8 percent increase compared to June of 1997 when 886 were authorized.

The Department further indicated that the 1,203 units permitted in June 1998 represent an increase of 14.4 percent from the 1,051 units permitted in May 1998. The year-to-date permits are up 15.1 percent, from 4,616 through June 1997, to 5,313 through June 1998.

"The 15 percent increase through the first half of 1998 is encouraging, especially coming after a 1997 that recorded the highest permit growth in nearly a decade," Abromaitis said. "Homebuilding is one of the anchors of our economy, and the housing sector continues to show great strength."

Reports from municipal officials throughout the state indicate Tolland County with 161.7 percent showed the greatest percentage increase in June compared to same month a year ago. Fairfield County followed with a 135.3 percent increase.

Fairfield County documented the largest number of new, authorized units in June with 353. Hartford County followed with 277 units and New Haven County had 179 units. Danbury led all Connecticut communities with 120 units, followed by Ellington with 64 and Newtown with 49.

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Connecticut Economy Continues To Throw A Party!

Last month, we reported in this space that "warning flags may be flying from the Connecticut coincident and leading employment indexes." Since month-by-month movements in economic data are noisy, we also indicated that "the warning may a false alarm and not a sign of bad things to come." This month's data provide a vote against these warning flags and a vote for continued expansion. That is, both the coincident and leading employment indexes reached new peaks in the current expansion with the release of (preliminary) May data.

The Connecticut coincident employment index, a barometer of current employment activity, last reached its current level in September 1990. Connecticut's leading employment index, a barometer of future employment activity, last reached its current level in August 1989. Non-farm employment, one of the components of the coincident index, has returned to its February 1990 level on several occasions in recent months and currently falls only 37,000 below its previous peak in February 1989. The unemployment rate, another component of the coincident index, last reached 3.8 percent, its level in three recent months including May, in August 1989. In other words, the economy has returned to an overall condition last experienced in the late 1980s, but without the serious imbalances and excesses associated with that period.

As the state economy throws a party, some regions have not yet fully participated in it. Of the five large cities, only Stamford has seen the good times roll. Bridgeport, Hartford, New Haven, and Waterbury have lagged behind in the current recovery. Moreover, the cities in Connecticut are much smaller geographic areas than is the norm in rest of the nation, which tends to concentrate reported inner-city problems. Connecticut's long-term future cannot ignore the fate of the inner cities. While growth in the state economy offers help for the inner cities, this growth cannot fully address the economic problems that they face. Public policy makers, civic leaders, and the citizens of Connecticut need to consider additional remedies.

In summary, the coincident employment index rose from 88.2 in May 1997 to 95.2 in May 1998. All four index components continue to point in a positive direction on a year-over-year basis with higher nonfarm employment, higher total employment, a lower insured unemployment rate, and a lower total unemployment rate.

The leading employment index rose from 89.9 in May 1997 to 92.3 in May 1998. All five index components sent positive signals on a year-over-year basis with a lower short-duration (less than 15 weeks) unemployment rate, lower initial claims for unemployment insurance, higher Hartford helpwanted advertising, higher total housing permits, and a longer average work week of manufacturing production workers.

SOURCE: Connecticut Center for or Economic Analysis, University of Connecticut. Developed by Pami Dua [Economic Cycle Research Institute; NY,NY] and Stephen M. Miller [(860) 486-3853, Storrs Campus]. Campus]. Kathryn E. Parr (860) 486-0485, Storrs Campus provided research support.

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Last Updated: October 15, 2002