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Connecticut Economic Digest: January 2005 issue
Connecticut's Economy: A Look Back...and Ahead | Occupation profile: RECREATION AND FITNESS WORKERS | Housing Update

Connecticut's Economy: A Look Back...and Ahead
By Mark R. Prisloe, Associate Economist, DECD

Iraq, energy prices, jobs, a polarizing election, and higher interest rates dominated the economic scene in 2004. This article explores their impact and takes a look at what these and other indicators mean for 2005.

Risks for 2005

The year 2004 brought us an escalation in the war in Iraq, continued threat of terrorist attacks, enormous increases in the price of crude oil, sharp increases in producer prices, a ballooning federal budget deficit, minimal job growth, and a hard fought presidential election and a polarized electorate. On the positive side, the U.S. economy continued to expand and productivity continued to increase.

As the war in Iraq persists, the cost will continue to rise putting further strain on the federal budget and severely limiting any future economic stimulus options. The continuing stand off between the U.S. and North Korea, as well as the emerging Iranian nuclear threat, will perpetuate uncertainty in the marketplace. Over the long run such uncertainty weakens consumer confidence.

Energy prices also became a renewed economic threat in 2004. With crude oil prices at unprecedented highs, the costs of air transportation, trucking, and gasoline at the pump gobbled increasing shares of business and consumer budgets, at least restraining--if not choking off--further economic expansion. With the manufacturing production index already down by 4.6 percent, it remains to be seen just how severe this threat will become, but it is definitely an issue that bears watching as a downside risk.

Other global issues also make up the international backdrop. China's seemingly insatiable demand for raw materials will continue to put upward pressure on producer prices. U.S.-China relations are sure to become a major issue in 2005 as the trade balance between the two countries has dramatically risen over the past few years to almost $150 billion annually. This, too, will put a drag on economic growth in 2005 and beyond.

Although the consensus is that the U.S. and Connecticut economies are enjoying a slow economic recovery, the question entering 2005 remains, "Where are the jobs?" One of the most hotly debated issues in the presidential race was the pace of U.S. job growth. Data from the U.S. Bureau of Labor Statistics show that from December 2000, just before Bush took office, to December 2003, the U.S. lost 2,406,000 jobs. However, the same source also shows that just before the election, the U.S. had regained 1,982,000 jobs from its December 2003 level.


Connecticut's job picture seesawed between gains of more than 4,000 jobs in both April and May 2004 to losses of the same magnitude in both June and July 2004. When the final data are in for 2004, it is likely Connecticut's employment in 2004 will barely have changed at all from 2003's estimated level of 1,644,000, leaving Connecticut employment still below the pre-2001 recession level. Even though overall Connecticut employment has stabilized, employment growth continues to elude most industry sectors here in the State. Productivity, Connecticut's leading competitive advantage, cuts both ways. While it increases the output of employed workers, employers can produce more with the same or fewer workers. This phenomenon will persist in the year ahead and continue the trend of slow job growth even as the economy expands. Further exacerbating the employment problem is the slow growth in the Connecticut labor force - worsened when discouraged workers leave the pool of eligible job seekers. Connecticut's employment probably won't surpass the 2000 high of 1.693 million until 2005.

Interest Rates

Continued lackluster job growth isn't our only worry for 2005 as the specter of inflation is once again lurking in the periphery. Higher producer prices, especially coupled with increasing energy costs, portend higher consumer prices down the road. However, the Fed has already begun raising interest rates and will likely continue to do so in increments of 25 basis points at each Federal Open Market Committee meeting, hopefully holding inflation at bay until neutral rates are achieved. Rising interest rates and construction costs should begin to dampen the U.S. and Connecticut housing markets; however Connecticut's housing market should continue to show strong results. At last report, year-to-date data for housing permits were up an impressive 21.0 percent to 8,797 units, on track to surpass 2003's high of 10,435 units. However, construction contracts, a standard measure of building activity, were down on a year-over-year basis by 8.8 percent. Despite higher interest rates, we should expect another solid year of housing growth in Connecticut in 2005 because housing demand is also driven by prices, incomes, and growth of households (household formation) that are currently favorable to new housing demand.

Consumer Spending

Higher interest rates will also have negative implications for consumer spending. Rising consumer debt and higher interest rates will constrain future consumer spending, the single most important component of Gross Domestic Product in the national income accounts. Indicators of consumer activity in Connecticut in 2004 point to a weakening in consumer spending. Year-to-date Connecticut auto registrations, a proxy for new car sales, were down 3.2 percent. Visitors at major Connecticut tourism attractions year-to-date were down 1.4 percent. Both the New England and the U.S. consumer confidence indices were down by 18.6 and 12.2 percent of their respective highs.


The well worn phrase, "wait until next year," which until recently was reserved for long suffering Red Sox fans, now seems appropriate in assessing the much anticipated - but never fully realized - 2004 economic recovery. Unfortunately, the dampening effect of rising interest rates on consumer spending, housing, construction, and business investment in both the U.S. and Connecticut will forestall rapid expansion of either economy next year. Despite this fact, I still expect Connecticut's long-term growth rate of 5 percent in the Gross State Product to be maintained as the State's high productivity and decade-long economic diversification continue to pay dividends.

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By Cynthia L. DeLisa, Research Analyst, DOL

What does the fitness industry have to offer? "It is really hard to find a job you love to be at every day. Having a fitness related career is exciting! You get to interact with many people, and receive satisfaction from helping people make positive changes to their lives and helping them achieve their personal best." ~ Mark, Personal Trainer - Newington, CT


People spend much of their leisure time participating in a wide variety of organized fitness related activities, such as aerobics, weight training, and sports. Fitness workers plan, organize, and direct these activities in community centers, fitness centers, and tourist destinations (i.e. cruise ships, spas and resorts). Increasingly, fitness workers also are found in workplaces, where they organize and direct fitness activities and athletic programs for employees of all ages. Persons planning fitness careers should be outgoing, good at motivating people, and sensitive to the needs of others. Excellent health and physical fitness are required due to the physical nature of the job.

Job Descriptions

Fitness trainers and instructors lead or coach groups or individuals in various exercise activities. Fitness trainers help clients to assess their level of physical fitness and help them to set and reach fitness goals. They also demonstrate various exercises and help clients to improve their exercise techniques, as well as keep records of their clients' exercise sessions in order to assess their progress towards physical fitness. Personal trainers work with clients on a one-on-one basis in either a gym or the client's home. Aerobic instructors conduct group exercise sessions that involve aerobic exercise, stretching, and muscle conditioning. Fitness directors oversee the operations of a health club or fitness center.

Training, Other Qualifications, and Advancement

Generally, fitness trainers and aerobics instructors must receive a certification in the fitness field to obtain employment. Certification may be offered in various areas of exercise such as personal training, weight training, and aerobics. Certification generally is good for 2 years, after which workers must become recertified. Most fitness workers are also required to maintain a cardiopulmonary resuscitation (CPR) and first aid certification. There are many organizations that offer certification testing in the fitness field, some of which are listed in the Sources of Additional Information section at the end of this article. College courses in management, business administration, accounting, and personnel management are helpful for advancement to supervisory or managerial jobs in a health club or fitness center. Some fitness workers go into business for themselves and open up their own fitness centers.

Employment Outlook and Average Wages

Overall employment for fitness trainers and instructors is expected to grow faster than the average for all occupations through 2012 as an increasing number of people spend more time and money on personal training, aerobic instruction, fitness and leisure services. Also, more public and private businesses are joining the fitness trend, recognizing the benefits of recreation and fitness programs as well as other wellness programs.

Fitness trainers and aerobic instructors in Connecticut earned an average hourly and annual salary of $19.15 and $39,820, respectively, in 2003 (see chart). Earnings higher than the statewide average are generally found in the southwestern areas of the State. Note: Earnings of successful self-employed personal trainers can be substantially higher. Connecticut's current and projected employment figures indicate that in 2000 there were approximately 4,720 fitness trainers and aerobics instructors employed in the State, with projected employment of 5,670 in 2010. That's a 20% increase!

At the national level, fitness trainers and aerobic instructors earned approximately $9,200 less per year than their peers in Connecticut, with an average annual and hourly salary of $30,590 and $14.71, respectively. Current and projected employment figures indicate that in 2002 there were approximately 182,720 fitness workers employed in the U.S., and projected employment of 263,947 (44.4% increase) in 2012.

Sources of Additional Information

American College of Sports Medicine (ACSM) -

American Council on Exercise (ACE) -

Aerobics and Fitness Association of America (AFAA) -

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Housing Update
Housing permits continue strong performance in November

Commissioner James F. Abromaitis of the Connecticut Department of Economic and Community Development (DECD) announced that Connecticut communities authorized 1,297 new housing units in November 2004, a 69.3 percent increase compared to November of 2003 when 766 units were authorized.

The Department further indicated that the 1,297 units permitted in November 2004 represent a 50.5 percent increase from the 862 units permitted in October 2004. The year-to-date permits are up 19.7 percent, from 9,156 through November 2003, to 10,956 through November 2004.

Two of the ten Labor Market Areas showed losses compared to a year ago. Meriden led all municipalities with 186 units, followed by Stamford with 115 and South Windsor with 99. From a county perspective, only Tolland County showed a year-to-date loss.

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Published by the Connecticut Department of Labor, Office of Research
Last Updated: January 4, 2006