1 the economic outlook for connecticut rae d. rosen senior economist and public information officer...

1

The Economic Outlook for Connecticut

Rae D. RosenSenior Economist and Public Information Officer

Federal Reserve Bank of New YorkJanuary 21, 2004

2

Key Points:

• Connecticut’s economy appears to be turning.• The negligible rate of job growth in Q4 2003

is projected to rise to around 1 percent in 2004.

• The fiscal picture is improving but will remain difficult well into 2005.

3

$40,000

$45,000

$50,000

$55,000

$60,000

#17 #6 #5 #4 #3 #2 #1

U.S. Average $43,057

Alaska

New Jersey

MarylandConnecticut

Massachusetts

New York

Source : U.S. Census Bureau, Current Population Survey.

National Ranking

Median Household Income2002

New Hampshire

4

Consumer Price IndexPercent change from 12 months earlier

-5

-3

-1

1

3

5

7

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-5

-3

-1

1

3

5

7Percent Percent

Source: Bureau of Labor Statistics.

United States

New York and Northeastern

New Jersey

United States - Services

U.S. Nov. '03 1.8%U.S. - Durable Goods Nov. '03 -4.6%U.S. - Services Nov. '03 2.9%NY/NE Nov. '03 3.1%

United States - Durable Goods

5

Second District Unemployment Rates

November 2002 November 2003United States 5.9% 5.9%Massachusetts 5.4% 5.4%New York City 8.3% 7.7%Connecticut 4.6% 5.0%Hartford 4.9% 5.3%Stamford 3.2% 3.2%

Source: Bureau of Labor Statistics.

6

3,000

4,500

6,000

7,500

9,000

9/7/01 1/26/02 6/16/02 11/4/02 3/25/03 8/13/03 1/1/043,000

4,500

6,000

7,500

9,000sadj. 4 - week

CT Initial Claims for Unemployment Insurance Seasonally Adjusted

Claims

Source: Connecticut Department of Labor

Claims

7

-7

-5

-3

-1

1

3

5

7

9

11

13

15

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-7

-5

-3

-1

1

3

5

7

9

11

13

15

Percent

United States

Percent

Wages and SalariesPercent change from 4 quarters earlier

United States 2003 Q2 1.5%Connecticut 2003 Q2 1.9%

Source: Bureau of Labor Statistics, FRBNY calculations.

Connecticut

8

-7

-5

-3

-1

1

3

5

7

9

11

13

15

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-7

-5

-3

-1

1

3

5

7

9

11

13

15

Percent

United States

Percent

Wages and SalariesPercent change from 4 quarters earlier

United States 2003 Q2 1.5%Connecticut 2003 Q2 1.9%


Connecticut

November

Avg, Weekly Wages rose 3.6%

9

Personal IncomePercent change from 4 quarters earlier

-3

-1

1

3

5

7

9

11

13

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-3

-1

1

3

5

7

9

11

13

Percent

United States

New York

United States 2003 Q2 2.8%New York 2003 Q2 1.2%Connecticut 2003 Q2 2.1%Percent


Connecticut

10

-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

Jan-02 Mar-02 May-02 Jul-02 Sep-02 Nov-02 Jan-03 Mar-03 May-03 Jul-03 Sep-03 Nov-03-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

Recent Trends in Regional EmploymentMonth over Month % Change

Source: Bureau of Labor Statistics

Percent Percent

Connecticut

United States

11

-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

Jan-02 Mar-02 May-02 Jul-02 Sep-02 Nov-02 Jan-03 Mar-03 May-03 Jul-03 Sep-03 Nov-03-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

Recent Trends in Regional EmploymentMonth over Month % Change

Source: Bureau of Labor Statistics

Percent Percent

Connecticut

United States

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Connecticut Net Migration

-21,000

-18,000

-15,000

-12,000

-9,000

-6,000

-3,000

0

1995 1996 1997 1998 1999 2000 2001 2002-21,000

-18,000

-15,000

-12,000

-9,000

-6,000

-3,000

0

Returns Returns

Source: Internal Revenue Service, Statistics of Income

13

Connecticut Migration

60,000

70,000

80,000

90,000

1995 1996 1997 1998 1999 2000 2001 200260,000

70,000

80,000

90,000

Returns Returns

Connecticut In

Connecticut Out

Source: Internal Revenue Service, Statistics of Income

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Net Domestic and International MigrationApril 1990 to July 1999

Net Domestic Migration

Net International Migration

Connecticut -226,370 73,389

New York -1,888,936 1,107,814

New Jersey -378,495 377,830

Source: U.S. Bureau of the Census.

15

Net Domestic and International MigrationApril 2000 to July 2002

Net Domestic Migration

Net International Migration

Connecticut -7,438 36,270

New York -372,929 329,727

New Jersey -54,460 141,469

Source: U.S. Bureau of the Census.

16

New York

ConnecticutNew Jersey

Massachusetts

CT to NJ 3,000NJ to CT 3,200

Percent of Workers That Commute fromOutside Area of Residence

Source: U.S. Census BureauC

T to

MA

14,

000

MA

to C

T 2

7,00

0

NJ

to N

Y 3

35,0

00N

Y to

NJ

126

,000

CT to NY 60,000

NY to CT 41,000

MA to NY 5,000NY to MA 6,000

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Recent Trends in Regional EmploymentPercent change from 12 months earlier

-7

-5

-3

-1

1

3

5

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-7

-5

-3

-1

1

3

5

Percent Percent

United States


United States Nov. '03 -0.2%Connecticut Nov. '03 -1.0%

Connecticut

18


-7

-5

-3

-1

1

3

5

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-7

-5

-3

-1

1

3

5

Percent Percent

United States


United States Nov. '03 -0.2%Connecticut Nov. '03 -1.0%Hartford Nov. '03 -1.3%

Connecticut

Hartford

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-7

-5

-3

-1

1

3

5

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-7

-5

-3

-1

1

3

5

Percent Percent

United States


United States Nov. '03 -0.2%Connecticut Nov. '03 -1.0%Hartford Nov. '03 -1.3%Stamford Nov. '03 -1.3%

Connecticut

Stamford

Hartford

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Growth in Service Jobs% change from November 2002 to November 2003

US Connecticut Stamford NYCProfessional & Business 1.0 -1.3 -1.8 -0.8

Security/Commodity Broker 0.8 -0.6 n/a -2.8Accommodation -1.8 1.8 1.9 2.3Eating and Drinking 1.4 0.1 * 2.8Motion Pictures -5.0 n/a n/a -13.2Architecture & Engineering 0.1 0.0 n/a -3.1Social 1.6 3.5 3.7 2.0Health 1.8 0.3 ** 1.7Educational 2.3 3.0 n/a 5.2Recreation -1.4 3.1 n/a 5.4Legal 0.8 0.7 2.2 -1.3Total Services 0.2 -0.4 -1.0 -0.6Services as % of Total Employment 83.2 84.2 91 93.0

Source: Bureau of Labor Statistics, Connecticut Department of Labor, FRBNY Calculations.

*Data for Eating & Drinking and Accommodation are combined at a higher NAICS level and reported as Accommodation.**Data for Social and Health are combined at a higher NAICS level and reported as Social

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22






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Office Vacancy RatesQuarterly

0

5

10

15

20

25

30

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 20030

5

10

15

20

25

30Percent Percent

Source: Coldwell Banker.

United States-Metropolitan

Note: Q3 2003 Overall Office Vacancy rate for Hartford was 21.8%. Source: Cushman and Wakefield.

Metropolitan NYC

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0

5

10

15

20

25

30

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 20030

5

10

15

20

25

30Percent Percent



Metropolitan Stamford


Metropolitan NYC

25


0

5

10

15

20

25

30

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 20030

5

10

15

20

25

30Percent Percent



Metropolitan Stamford


Metropolitan NYC

Hartford

26

Home PricesPercent change from 4 quarters earlier

-6

-4

-2

0

2

4

6

8

10

12

14

16

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003-6

-4

-2

0

2

4

6

8

10

12

14

16Percent Percent

Source: Office of Federal Housing Enterprise Oversight.

United States

New York

United States 2003 Q3 5.6%New York 2003 Q3 7.5%Connecticut 2003 Q3 7.1%

Connecticut

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Percent of Residential Mortgage Loans with Installments 90 Days Past Due

0.0

0.2

0.4

0.6

0.8

1.0

1.2

92Q2 93Q3 94Q4 96Q1 97Q2 98Q3 99Q4 01Q1 02Q2 03Q30.0

0.2

0.4

0.6

0.8

1.0

1.2PercentPercent

Source: Mortgage Bankers Association

New York

Connecticut


United States

28

Percent of Residential Mortgage Loans in Foreclosure Started During the Quarter

0.0

0.5

1.0

1.5

2.0

2.5

92Q2 93Q3 94Q4 96Q1 97Q2 98Q3 99Q4 01Q1 02Q2 03Q30.0

0.5

1.0

1.5

2.0

2.5PercentPercent

Source: Mortgage Bankers Association

Connecticut

New York


United States

29

Source: U.S. Bureau of the Census, 2000.

Highest Degree ObtainedPercent of population 25 years old and older

U.S. Connecticut Stamford New York City

High School Diploma or Higher 80.4 84.0 82.2 72.3

Bachelor's Degree or Higher 24.4 31.4 39.6 27.4

Graduate or Professional Degree 8.9 13.3 16.9 11.6

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Source: U.S. Bureau of the Census, 2000.

Highest Degree ObtainedPercent of population 25 years old and older

U.S. Connecticut Stamford New York City

High School Diploma or Higher 80.4 84.0 82.2 72.3

Bachelor's Degree or Higher 24.4 31.4 39.6 27.4

Graduate or Professional Degree 8.9 13.3 16.9 11.6

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$24,820

$63,582

$69,337$65,249

$48,834

$32,135

$50,756

$27,611

$39,355$38,293

$20,000$25,000$30,000$35,000$40,000$45,000$50,000$55,000$60,000$65,000$70,000

10 20 30 40 50

Fairfield County

Hartford County

New York City (five boroughs)

Median Household Income and Higher Education

Source: U.S. Census Bureau, Census 2000Note: Data are for counties, except where noted

Percent of Population Age 25 and above with a Bachelor’s Degree or higher

Westchester County

Kings County (Brooklyn)

Bronx County

Suffolk County (Boston)

Hartford City

New Haven County

Stamford City

32

Immigrants Arriving

Pre-1990

Immigrants Arriving

1990-1999

US Born 2000

Degree<High School 34 29 20High School Graduate 26 23 29Some College (<Bachelor's) 18 17 27Bachelor's or above 22 31 24

ConnecticutImmigrant and U.S Born Population by Educational Level

25 Years Old and Older(Percent)

Source: U.S. Census Bureau

33

Country of OriginPeriod Entered

Median Income* Number

Japan 1990-99 $60,000 774Non foreign born CT 1990-99 $38,000 1,201,814China, Hong Kong 1990-99 $35,000 2,441Philippines 1990-99 $32,000 1,478Foreign born pre1990 $31,200 151,105Russia, Ukraine, Uzbekistan 1990-99 $30,000 1,776Korea 1990-99 $30,000 469India, Bangladesh, Pakistan 1990-99 $27,900 5,297Poland 1990-99 $27,000 4,277Jamaica, Trinidad, Haiti, Guyana 1990-99 $20,000 5,291Dominican Republic, Puerto Rico 1990-99 $17,000 6,449Mexico 1990-99 $16,600 2,308Ecuad, Colum, Peru, Hond, El Salvador 1990-99 $15,000 5,489

Earnings in Connecticut

* Median Earnings 1999 for Connecticut population 25 and older with any incomeSource: U.S. Census Bureau

1 the economic outlook for connecticut rae d. rosen senior economist and public information officer...

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