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Connecticut Economic Digest: February 2003 issue
Unmasking the Unemployment Rate | Town/City Profile: Simsbury | Occupation Profile: Physical Therapists | Industry Clusters | Housing Update

Unmasking the Unemployment Rate

As far as public interest is concerned, the unemployment rate is one of the most important figures generated by the Connecticut Department of Labor's Office of Research. The unemployment rate is used as a key indicator of our State's economic well being. Businesses and community leaders use the unemployment rate in guiding decisions regarding site locations and plant expansions; areas of high unemployment may offer tax breaks and other economic development incentives. Government officials use the unemployment rate as a basis for awarding government procurement contracts and to allocate millions of dollars in job training and economic development funds. Nationally, the unemployment rate influences the financial markets and, to some extent, interest rates. Despite all the attention to the unemployment rate, it remains one of the most misunderstood and often misused numbers that exists. Just where does the unemployment rate come from, and what does it mean?

Common Misconceptions

Perhaps the most common misconception about the unemployment rate is that it just includes individuals filing unemployment insurance (UI) claims. Actually, UI claimants comprise only about 20 to 30 percent of the total unemployed. Another misconception is that the monthly unemployment rate represents unemployment for the entire month. In reality, the jobless rate references the week of the month that includes the 12th. This is called the standard survey reference week. Unemployed individuals are also counted where they live, not where they work. This means that a layoff in a particular town can, because of commuting, impact the unemployment rate in number of surrounding towns.

Who is Counted as Unemployed?

The definition of who is counted as employed and unemployed is determined by the U.S. Bureau of Labor Statistics (BLS). These definitions are based on objective, measurable criteria, and are used nationwide. This means that the criteria defining an unemployed person in Connecticut is the same for an unemployed person in Idaho or South Carolina or anywhere else in the nation. To be counted as employed, a person must be 16 years old or over and have worked for pay or profit during the survey week. This includes part-time and temporary work as well as regular full-time, year-round employment. An individual that works as little as one hour during the survey week is counted as employed. To be counted as unemployed, a person must be 16 years old or over and have no job at all during the survey week. However, that person must be able, available, and actively looking for work. The sum of the employed and unemployed comprises the labor force. The unemployment rate is the ratio of the total unemployed to the total labor force. The mathematical formula is: Employed + Unemployed = Labor Force, and (Unemployed / Labor Force) x 100 = Unemployment Rate.

Where Do These Numbers Come From?

Each month, BLS designates the Census Bureau to conduct a survey of approximately 72,000 households across the nation called the Current Population Survey (CPS). The CPS, which includes households in each state, is conducted during the week after the standard survey reference week. During the survey, the census interviewer determines the employment status of all members of the household 16 years old and over for the previous week. They essentially ask, "what were you doing last week?" If they held a job, they are classified as employed; if they had no job, but were able, available, and actively looking for one, they are classified as unemployed. The CPS is designed to yield employment and unemployment statistics each month for the nation as a whole. Connecticut, with a population of 3.4 million, has approximately 1,200 households represented in the CPS. To improve the estimate, BLS has designed a statistical model for states to use. This model uses a variable coefficient regression method, which uses two CPS numbers - residents employed and unemployed. The model supplements the results from the household survey with nonfarm payroll employment data from our monthly survey of businesses and claims data from Connecticut's unemployment insurance program. Other variables include agriculture employment, population, and seasonal factors.

How Accurate is the Unemployment Rate?

For any state, the actual unemployment rate could vary by up to a percentage point either side of the published rate. It is an estimate and is by no means 100 percent accurate. The only way to arrive at a completely accurate rate would be to conduct a complete census each month. This would be too costly and too time consuming. The current methodology is the result of decades of research and improvements in modeling techniques. BLS is constantly researching ways to improve the accuracy of state and local unemployment statistics, and methodologies will continue to evolve and improve over time. The current methodology is the best that is available, and for years has proven to mirror known economic developments in the State.

The unemployment rate is just one of many economic indicators. It should be used in concert with other useful labor market statistics in decision making and in assessing economic trends. Because employment and unemployment statistics are estimates, they are subject to sampling variability in any given month, and temporary statistical aberrations occur. Consequently, it is best to view these data over time to determine underlying trends in the economy.

A Historical Perspective

As the chart shows on the front page, Connecticut's seasonally adjusted unemployment rate declined from its peak in 1992 through the end of the decade. In September 2000, the jobless rate began to climb again. National unemployment rates also trended downward for almost nine years, before beginning to rise in November 2000. For most of those years, Connecticut's unemployment rates were below that of the nation, except for the 1996-97 period. The jobless situation in Connecticut has compared favorably since 1998, as evidenced by widened gap between the U.S. and Connecticut.

Prior to annual revisions, Connecticut's unemployment rate averaged 3.9 percent in 2002, still relatively low compared with the early nineties, and well below the nation's average of 5.8 percent. Nevertheless, the increases in the unemployment rates in recent months suggest that our State's economy is not out of the woods yet.

SOURCES: Adapted and reprinted with permission from an article, "The unemployment rate - behind the mystery" by Sam McClary of Labor Market Information in South Carolina, and from the Idaho Employment's September 2001 article, "F.Y.I.: unemployment rate demystified," and modified as it relates to Connecticut.

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Town/City Profile: Simsbury
By Stephen Dombrowski, Marketing Representative, DOL


Tucked away in the north central hills of Hartford County, along the Metacomet trail, lies the bucolic town of Simsbury. Its rich history predates the eighteenth century with settlers migrating from the town of Windsor in the 1670s, searching for religious autonomy and fertile land for crop planting. The Tariffville section in 1845 was home to the thriving Hartford Carpet Company. The Ensign Bickford Company, established in 1836, was made famous for the safety fuse used to this day in demolition blasting. It remains a major employer in the town, and now has an aerospace division as well. Simsbury experienced a tremendous economic gain in 1981 with the agreement and land purchase by the Hartford Insurance Group to bring their life insurance division to town. Over the next five years, this created several thousand jobs within the finance sector which enhanced the local economy through housing purchases, new construction, and patronization of the wholesale and retail trade sectors, along with the service sector.


Over the past eleven years, Simsbury has experienced healthy growth in its agriculture, retail trade, finance, insurance, and real estate, and services industries. Over 2,400 new positions have been created within the town in these sectors, offsetting declines in its construction, manufacturing, and transportation, communication, and public utilities industries. The town has always enjoyed a relatively low unemployment rate, averaging about 2.7 percent annually since 1991 (see table below). People who have made Simsbury their home enjoy easy access to Bradley International Airport, just twelve miles away, as well as a short 13-mile commute to Hartford. This strategic location, coupled with viable first rate office and commercial space (73,000 square feet and 353 acres zoned as commercial/ industrial), are key economic development factors for a town poised to welcome additional light industry and service sector businesses. New housing permits surged to over 100 in 1993 with an additional 448 reported in the last eight years. The average price for a single-family house in Simsbury in 2000 was $233,495 compared with the State average of $219,784. Housing within the town remains competitive and desirable due in part to the boasting rights Simsbury enjoys in terms of its public school system. It implements an annual education budget of over 40 million dollars per year and has been rated as having one of the best public school systems in Hartford County by Connecticut Magazine (November 2002) and best in the State by the Wall Street Journal publication, "Offspring" (July 2000).

Quality of Life

Simsbury has many attributes to offer people looking for a higher standard of living. Prep schools such as Ethel Walker, the Masters School and the Westminster School offer superb four-year education programs preparing their students for the challenges and opportunities of higher education. Cultural entities such as the Simsbury Light Opera Company and the Simsbury Theatre Guild hold command performances each season, enjoyed by thousands of Connecticut's citizens. The public library holds over 136,000 volumes and received the prestigious ranking as one of the top 100 public libraries in the nation out of 9,000 contending (Hennan American Public Library rating 2002). It also operates one of the first business resource centers, answering over 5,000 business related questions annually.


Simsbury's diversified business structure, tradition of cultural and educational excellence, and the ability to draw economic initiatives that are juxtaposed to the quality of life its citizens enjoy, keeps it positioned for steady growth. The commercial frontier lies within the northern parcels of land conveniently located just minutes from Bradley International Airport. A tax abatement program continues to offer attractive financial incentives to businesses. Growth and prosperity have been woven into the fabric of the town for many decades with no signs of reversal on the horizon. The efforts of Simsbury's citizens, business leaders, and educators remain a cornerstone in the foundation of a community where quality of life and economic development are tantamount to keeping this town a very desirable place to live, work, and prosper.

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Occupation Profile: Physical Therapists
By Jungmin Charles Joo, Associate Research Analyst, DOL


As the number of middle-aged and elderly individuals in the State increases, so does the demand for therapeutic services. The demand for physical therapists, for one, is expected to be high through the next decade, with employment opportunities rising faster than average.

Nature of the Work

Physical therapists provide services that help restore function, improve mobility, relieve pain, and prevent or limit permanent physical disabilities of patients suffering from injuries or disease. They work to restore, maintain, and promote overall fitness and health. Their patients include accident victims and individuals with disabling conditions such as low back pain, arthritis, heart disease, fractures, head injuries, and cerebral palsy.

Working Conditions

Physical therapists practice in hospitals, clinics, and private offices that have specially equipped facilities, or they treat patients in hospital rooms, homes, or schools. Most full-time physical therapists work a 40-hour week, which may include some evenings and weekends. The job can be physically demanding because therapists often have to stoop, kneel, crouch, lift, and stand for long periods. In addition, physical therapists move heavy equipment and lift patients or help them turn, stand, or walk.


In Connecticut, 2,150 were employed as physical therapists in 2001. Nationally, they held about 126,500 jobs; about 1 in 4 worked part time. The number of jobs is greater than the number of practicing physical therapists because some physical therapists hold two or more jobs. For example, some may work in a private practice, but also work part time in another health facility. About two-thirds of physical therapists were employed in either hospitals or offices of physical therapists. Other jobs were in home health agencies, outpatient rehabilitation centers, offices and clinics of physicians, and nursing homes. Some physical therapists are self-employed in private practices.

Training and Other Qualifications

All states require physical therapists to pass a licensure exam before they can practice, after graduating from an accredited physical therapist educational program. According to the American Physical Therapy Association (, there were 199 accredited physical therapist programs in 2001. Of the accredited programs, 165 offered master's degrees, and 33 offered doctoral degrees. All physical therapist programs seeking accreditation are required to offer degrees at the master's degree level and above, in accordance with the Commission on Accreditation in Physical Therapy Education.

Physical therapists should have strong interpersonal skills to successfully educate patients about their treatments. They should also be compassionate and possess a desire to help patients. Similar traits also are needed to interact with the patient's family. Physical therapists are expected to continue professional development by participating in continuing education courses and workshops. A number of States require continuing education to maintain licensure.


The national average annual wage for physical therapists was $59,120, while Connecticut's was higher at $65,175 in 2001. As the chart shows, the earnings among the regions of the State ranged from $50,920 in the New London Labor Market Area to $80,940 in the Hartford Labor Market Area.

Job Outlook

Federal legislation imposing limits on reimbursement for therapy services may adversely affect the job market for physical therapists in the near term. However, over the long run, the demand for physical therapists should continue to rise as a result of growth in the number of individuals with disabilities or limited function requiring therapy services. The rapidly growing elderly population is particularly vulnerable to chronic and debilitating conditions that require therapeutic services. Also, the baby-boom generation is entering the prime age for heart attacks and strokes, increasing the demand for cardiac and physical rehabilitation. Additionally, more young people will need physical therapy as technological advances save the lives of a larger proportion of newborns with severe birth defects. Nationally, employment of physical therapists is expected to grow by 33 percent, which is much faster than the 15 percent average growth for all occupations through 2010. It is also expected to grow faster than the average for all occupations (10 %) in Connecticut over next ten years, adding more than 100 openings each year.

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Industry Clusters
Maritime Cluster Outlines Transportation Recommendations

The Connecticut Transportation Strategy Board’s recently released strategic plan for addressing Connecticut’s transportation issues includes recommendations made by the Connecticut Maritime Coalition. The plan calls for the establish-ment of a special task force to develop a statewide maritime policy. It also calls for an alloca-tion of funds to enhance feeder barge capability and recom-mends that the federal-state law conflict related to dredging be addressed.

During the information gathering process, the Connecticut Maritime Coalition submitted statistics, studies and testimony to the Transportation Strategy Board. A Connecticut Maritime Coalition report, entitled Connecticut’s Ports: Transportation Centers for Goods and People, outlined specific recommendations to capitalize on Connecticut’s maritime industries and waterways to improve Connecticut’s transportation system. A copy of this report and executive summary can be downloaded the Connecticut Maritime Coalition’s website:

Activated as an industry cluster group in 2001, the Connecticut Maritime Coalition represents 349 businesses, 12,225 jobs and aggregate sales of $2.61 billion.

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Housing Update
Permit Activity Was Remarkably Strong in 2002

Commissioner James F. Abromaitis of the Connecticut Department of Economic and Community Development an-nounced that Connecticut com-munities authorized 605 new housing units in December 2002, a 4.9 percent decrease compared to December of 2001 when 636 units were authorized.

The Department further indicated that the 605 units permitted in December 2002 represent a 21.5 percent decrease from the 771 units permitted in November 2002. The year-to-date permits are up 3.8 percent, from 9,254 through December 2001, to 9,607 through December 2002.

"In light of the economic uncertainty we have experienced in Connecticut the past year, housing permit activity was remarkably strong in 2002," said Commissioner Abromaitis. "The 9,607 housing units authorized represents the highest total in the past three years and the third highest total since 1990."

Six of the eight counties had increases in new housing authorizations compared to a year ago. Danbury led all Connecticut communities with 261 units, followed by Stamford with 219 and Newtown with 195.

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Published by the Connecticut Department of Labor, Office of Research
Last Updated: February 3, 2003