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September 6, 2019

CBIA: CT biz growth up, but negative outlooks persist

Photo | CBIA A panel on Friday discussed CBIA’s 2019 Survey of Connecticut Businesses at Hartford Marriott Downtown. From left to right, the panelists include: Michael Brooder, Hartford office managing partner, Marcum LLP; Kristofer Kolstad, vice president of market and business development, Kaman Specialty Bearings & Engineered Products; Jessica Rich, managing partner, vice president of business operations, The Walker Group; Scott Dolch, executive director, Connecticut Restaurant Association.
By Joe Cooper

A new survey conducted by Connecticut’s largest business lobby says a growing number of businesses reported profits in 2018, but employers remain concerned about the potential for statewide economic growth.

More than 350 executives polled by the Connecticut Business & Industry Association (CBIA) in its annual Survey of Connecticut Businesses show that 70 percent of respondents in the state reported a profit last year, marking a post-recession high.

The bottom line gains were driven in part by an increase in sales growth last year reported in CBIA’s survey, which was aired Friday at CBIA’s annual Connecticut Economy conference at Hartford Marriott Downtown.

In fact, 43 percent of businesses reported sales growth in 2018, up from 36 percent in 2017, and the highest rate in five years, according to the survey.

Still, just 11 percent of executives say they expect the state’s economy to grow in the next year, down from 18 percent a year prior. Meantime, 73 percent of respondents believe the U.S. economy will grow in the next year, down from 85 percent last year.

The declining confidence in Connecticut’s economy may have been driven by certain state laws adopted this year, according to the survey, which was conducted after the legislative session ended between mid-June and late July.

In particular, respondents had a bearish outlook on the state’s passage of a $15 hourly minimum wage and a paid family and medical leave program.

When asked how companies planned to manage the state’s minimum wage being raised to $15 by 2023, 43 percent of respondents said they plan to reduce their staff, and 13 percent will raise prices. Another 10 percent said they will relocate or ramp down operations here. 

Nine percent of respondents said they will not change how they operate following the wage hike.

Respondents were also concerned about the state’s new $43.4 billion, two-year budget, which CBIA says relies heavily on tax and fee increases.

“...small businesses were particularly rankled by the legislative session,” the survey said. “Generally speaking, smaller employers feel unfairly targeted by those two mandates, which are expected to further increase business costs in the state.”

CBIA CEO and President Joe Brennan said Connecticut businesses are still finding ways to grow, but added that state lawmakers need to address their concerns that were “clearly apparent” in the survey.

“State policymakers must acknowledge these very real concerns and focus on policies that restore confidence, promote investment, and drive long overdue economic and job growth,” Brennan said.

The margin of error in the survey is plus or minus 5 points. 

View CBIA’s survey results here

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