THE STATE OF WORKING CONNECTICUT

Patrick R. O’Brien, Ph.D., Research and Policy Director

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut | 1

SEPTEMBER 2023
 Contents
Introduction----------------------------------------------------------------------------------------------------------- 3
Overview of Connecticut’s Economy-------------------------------------------------------------------------------- 7
Employment Growth---------------------------------------------------------------------------------------------- 7
Personal Income Growth---------------------------------------------------------------------------------------10
Gross Domestic Product Growth------------------------------------------------------------------------------13
Overview of Wages in Connecticut--------------------------------------------------------------------------------16
Wage Growth------------------------------------------------------------------------------------------------------16
Wage Inequality--------------------------------------------------------------------------------------------------19
Wage Gaps---------------------------------------------------------------------------------------------------------21
Policy Options---------------------------------------------------------------------------------------------------------24
Conclusion-------------------------------------------------------------------------------------------------------------26
Acknowledgements--------------------------------------------------------------------------------------------------27
References and Notes------------------------------------------------------------------------------------------------28

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 Introduction
The purpose of Connecticut Voices for Children’s (CT Voices’) annual State of Working Connecticut report
is to provide an overview of Connecticut’s economy, especially its labor market, to dive deeper into the
status of certain workers, and to provide policy options to support Connecticut’s economy and workers. To
that end, the report proceeds in three sections reviewed below.

The first section provides an overview of Connecticut’s economy and it proceeds in three parts: (1) an
overview of employment growth, which is important because hourly wages and annual salaries from jobs
are the primary source of income for most families; (2) an overview of personal income growth, which is
important because it is the primary economic indicator impacting allowable growth in budget appropriations
under Connecticut’s spending cap; and (3) an overview of gross domestic product (GDP) growth, which is
important because Connecticut has a high level of long-term obligations and when GDP grows, the tax base
increases, making it easier for the state to generate the revenue it needs to service long-term obligations
while also increasing spending on critical public investments and providing tax cuts for low- and middle-
income families to make the tax system fairer. The key findings are summarized below.

Employment Growth
• Using the pandemic-induced recession as a baseline, Connecticut’s nonfarm employment growth
through June 2023 is 3.1 percentage points lower than the growth rate for the U.S. as a whole. If
Connecticut’s nonfarm employment growth had mirrored the growth rate for the U.S. over this
period, the state would have nearly 53,000 additional jobs.

• Using the Great Recession as a baseline, Connecticut’s nonfarm employment growth through June
2023 is 14.4 percentage points lower than the growth rate for the U.S. as a whole. If Connecticut’s
nonfarm employment growth had mirrored the growth rate for the U.S. over this period, the state
would have about 246,000 additional jobs.

Personal Income Growth

• Using the pandemic-induced recession as a baseline, Connecticut’s total personal income growth
through the fourth quarter of 2022 is 4.2 percentage points lower than the growth rate for the
U.S. as a whole, and the state’s compound annual growth rate is 1.3 percentage points lower. If
Connecticut’s personal income growth had mirrored the growth rate for the U.S. over this period,
the state’s budget could include on average nearly $200 million per year in additional spending on
critical public investments.

• Using the Great Recession as a baseline, Connecticut’s total personal income growth through
the fourth quarter of 2022 is 30.2 percentage points lower than the growth rate for the U.S.
as a whole, and the state’s compound annual growth rate is 1.3 percentage points lower. If
Connecticut’s personal income growth had mirrored the growth rate for the U.S. over this period,
the state’s budget could include on average at least several hundreds of millions of dollars more,
and potentially billions of dollars more, each year on critical public investments.

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Gross Domestic Product Growth
• Using the pandemic-induced recession as a baseline, Connecticut’s nominal GDP growth through
the fourth quarter of 2022 is 7.5 percentage points lower than the growth rate for the U.S. as a
whole.If Connecticut’s GDP growth had mirrored the growth rate for the U.S. over this period, the
state’s GDP would be nearly $22 billion larger, which would provide more than a billion dollars
in additional revenue without raising tax rates and could be used to pay the state’s high-level
of long-term obligations while also both increasing spending on critical public investments and
providing tax cuts for low- and middle-income families to make the tax system fairer.

• Using the Great Recession as a baseline, Connecticut’s nominal GDP growth through the fourth
quarter of 2022 is 37.9 percentage points lower than the growth rate for the U.S. as a whole. If
Connecticut’s GDP growth had mirrored the growth rate for the U.S. over this period, the state’s
GDP would be nearly $89 billion larger, which would provide billions of dollars in additional
revenue without raising tax rates and could be used to pay the state’s high-level of long-term
obligations while also both increasing spending on critical public investments and providing tax
cuts for low- and middle-income families to make the tax system fairer.

The second section provides an overview of wages in Connecticut for different groups of workers and it
proceeds in three parts: (1) an overview of wage growth; (2) an overview of wage inequality; and (3) an
overview of wage gaps. The key findings are summarized below.

Wage Growth
• From 2019 through 2022, which covers most of the recovery from the pandemic-induced
recession, wage growth in Connecticut for low-wage workers exceeded wage growth for middle-
wage workers, and wage growth for both low- and middle-wage workers was greater on average
in Connecticut than in the U.S. as a whole. Moreover, in both the U.S. and Connecticut, wage
growth for low- and middle-wage workers generally exceeded inflation, which helped to raise the
standard of living for low- and middle-wage workers, especially low-wage workers.

• From 2021 through 2022, which covers only the more recent recovery from the pandemic-induced
recession, wage growth in Connecticut for low-wage workers generally exceeded wage growth
for middle-wage workers, and wage growth for low-wage workers, but not middle-wage workers,
was greater on average in Connecticut than in the U.S. as a whole. However, in both the U.S. and
Connecticut, wage growth for low- and middle-wage workers was generally lower than inflation,
which partially offset the gains in 2020 and 2021 in the standard of living for low- and middle-
wage workers.

Wage Inequality
• Higher real wage growth for low-wage workers compared to middle-wage workers partially
reduces Connecticut’s high level of wage inequality. However, the primary source of wage
inequality in Connecticut is the difference in wages for high-wage workers compared to low- and
middle-wage workers, and data limitations prevent an analysis of that dynamic in 2022.

• Public sector jobs, which are highly unionized, are essential for reducing Connecticut’s high level
of wage inequality.

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Wage Gaps
• The gender wage gap, racial wage gap, and ethnic wage gap are all substantial and increase at
higher wage percentiles, connecting all three wage gaps to wage inequality.

The third section provides policy options to support Connecticut’s economy and workers and the policy
options are presented in four broad categories: housing, justice, employment, and taxation. The policy
options are summarized below.

Policy Options
• Make housing more affordable, especially by increasing the supply of housing. Making housing
more affordable will make it easier both for existing workers to stay in the state and for potential
workers to move to the state, which will increase the labor force and job growth and that in turn
will increase personal income growth and GDP growth. At the same time, it will help to offset in
part the negative impact of wage inequality and wage gaps by reducing the percentage of income
that workers spend on housing. Among the many housing policy options to support Connecticut’s
economy and workers presented in CT Voices’ recent research, four are highlighted here:

o Use “sticks” and “carrots” to incentivize municipalities to promote affordable housing

development.

o Create more incentives to encourage the construction of mixed-income housing close to

public transportation.

o Increase investment in the remediation of blighted properties and put them back into
productive use to benefit the communities where they are located.

o Expand the jurisdiction of public housing authorities.

• Provide increased support and reduce barriers to work for residents with involvement in the
criminal legal system. Providing increased support and reducing barriers to work for residents
with involvement in the criminal legal system will strengthen and increase the state’s labor force
and job growth and that in turn will increase personal income growth and GDP growth. At the
same time, it will help to reduce wage inequality and wage gaps by increasing the skills of these
workers and the job opportunities available, which in turn will increase their potential earnings.
Among the many justice policy options to support Connecticut’s economy and workers presented
in CT Voices’ recent research, four are highlighted here:

o Require correctional facilities to begin career planning and preparation before individuals
reenter their communities and also expand work release programs.

o Limit occupational exclusionary policies to those where exclusions are necessary for job
duties and requirements.

o Ensure that eligible individuals have a driver’s license in hand upon leaving carceral facilities
and also repeal policies that suspend or revoke a driver’s license for reasons unrelated to
driving incidents.

o Reinvest savings from reducing carceral facilities into reentry and prevention services.

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 • Strengthen the early care and education (ECE) system and labor market more generally.
Strengthening the ECE system and labor market more generally will increase the size of the
state’s labor force and job growth and that in turn will increase personal income growth and
GDP growth. At the same time, it will help to reduce wage inequality and wage gaps, first, by
increasing the pay of ECE workers—who are generally low-wage workers and disproportionately
women and workers of color—and, second, by increasing the percentage of workers in unions,
which tend to have a fairer wage distribution. It will also help to offset in part the negative impact
of wage inequality and wage gaps by reducing the percentage of income that low- and middle-
wage workers pay for ECE. Among the many ECE and broader labor market policy options to
support Connecticut’s economy and workers presented in CT Voices’ recent research, four options
are highlighted here:

o Increase compensation for ECE workers while also capping co-pays to ensure that no family
pays more than seven percent of their income on ECE.

o Provide sufficient funding to fill public sector jobs.

o Require employers to provide a fair work week schedule.

o Limit the ability of employers to use noncompete agreements.

• Make the tax system fairer. Making the tax system fairer will increase the post-tax income of
low- and middle-wage workers, which will increase consumer spending and in turn GDP growth.
At the same time, it will reduce post-tax income inequality and income gaps, offsetting in part the
negative impact of wage inequality and wage gaps. Among the many tax policy options presented
in CT Voices’ recent research, four are highlighted here:

o Eliminate or reduce Connecticut’s tax gap to generate revenue.

o Eliminate or reduce high cost, high growth tax expenditures to generate revenue.

o Use the additional revenue to create a fully refundable Connecticut child tax credit.

o Use the additional revenue to improve the Connecticut property tax credit.

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 Overview of Connecticut’s Economy
This section provides an overview of Connecticut’s economy and it proceeds in three parts. The first part
provides an overview of employment, or job, growth. The second part provides an overview of personal
income growth. The third part provides an overview of gross domestic product growth.

Employment Growth

Each month, the U.S. Bureau of Labor Statistics (BLS) provides a measure of growth in nonfarm
employment, or jobs. Jobs are important for Connecticut because hourly wages and annual salaries from
jobs are the primary source of income for most families. Jobs are also important because—as addressed
in the next two parts of this section—job growth is a major component of personal income growth and
gross domestic product growth, both of which impact the state’s ability to make critical public investments
as well as to establish a fairer tax system to funds those public investments. The impact on the budget in
turn impacts the state’s ability to help raise the standard of living for low- and middle-income families,
especially families living in poverty.

Two key, related findings concerning nonfarm employment, or job, growth are reviewed below.

Using the pandemic-induced recession as a baseline, Connecticut’s nonfarm employment growth through
June 2023 is 3.1 percentage points lower than the growth rate for the U.S. as a whole. If Connecticut’s
nonfarm employment growth had mirrored the growth rate for the U.S. over this period, the state would
have nearly 53,000 additional jobs. Figure 1 shows the change in nonfarm employment in the U.S. and
Connecticut since the pandemic-induced recession.1 In the U.S., employment decreased by 14.4 percent, or
21.9 million jobs, from February 2020 to April 2020. The U.S. then recovered its job shortfall by June 2022,
and, through June 2023, the number of jobs has grown by 2.5 percent since February 2020. In comparison,
Connecticut initially faced a steeper decline in employment, with a reduction of 17 percent, or 289,100
jobs, from February 2020 to April 2020. Moreover, through June 2023, employment in Connecticut is still
down 0.6 percent since February 2020, resulting in a job growth gap of 3.1 percentage points compared to
the U.S. If Connecticut had matched the growth rate for the U.S. since February 2020, the state would have
an estimated 1.740 million jobs, which is 52,700 more jobs compared to the current total of 1.687 million
jobs.

Connecticut’s slower job recovery is due in part to the decline in state and local government jobs, the sector
over which state policymakers have the most direct control. Specifically, in the U.S. through June 2023,
public sector employment overall (federal, state, and local) is down 0.7 percent since February 2020 and
state and local government employment is down 1.1 percent. In comparison, public sector employment
overall in Connecticut through June 2023 is down 2.2 percent since February 2020 and state and local
government employment is down 2.5 percent, meaning Connecticut has lost a higher percentage of public
sector jobs compared to the U.S.2

Using the Great Recession as a baseline, Connecticut’s nonfarm employment growth through June 2023 is 14.4
percentage points lower than the growth rate for the U.S. as a whole. If Connecticut’s nonfarm employment
growth had mirrored the growth rate for the U.S. over this period, the state would have about 246,000
additional jobs. Figure 2 shows the change in nonfarm employment growth in the U.S. and Connecticut
since the Great Recession.3 This is important historical context because it shows that Connecticut’s slower

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job recovery from the pandemic-induced recession builds
upon a slower job recovery from the Great Recession.
Specifically, in the U.S., employment decreased by 6.3
percent, or 8.7 million jobs, from December 2007 to
February 2010. The U.S. then recovered its job shortfall
in May 2014, and, through June 2023, the number of
jobs has increased by 12.9 percent since December 2007.
In comparison, Connecticut faced a steeper decline in
employment, with a reduction of 6.5 percent, or 110,700
jobs, from December 2007 to February 2010. Moreover,
Connecticut never fully recovered its lost jobs before the
start of the pandemic-induced recession, and, through
June 2023, the state’s job growth is down 1.5 percent,
or 25,300 jobs, since December 2007, resulting in a
job growth gap of 14.4 percentage points compared to
the U.S. If Connecticut had matched the growth rate for
the U.S. since December 2007, the state would have an
estimated 1.933 million jobs, which is 246,200 more jobs
compared to the current total of 1.687 million jobs.

Here too, Connecticut’s slower job recovery is due in

part to the decline in state and local government jobs.
Specifically, in the U.S. through June 2023, public sector
employment overall (federal, state, and local) is up 1.5
percent since December 2007 and state and local government employment is up 0.9 percent. In comparison,
public sector employment overall in Connecticut is down 10 percent since December 2007 and state and
local government employment is down 10.5 percent, or 24,900 jobs, meaning Connecticut has lost a higher
percentage of public sector jobs compared to the U.S.4

For additional context on the importance of the decline in public sector jobs, consider two examples.
First, the objective of the Audit Division in the Connecticut Department of Revenue Services (DRS) is
“to determine the accuracy of tax reporting through comprehensive field and office audits of targeted
accounts in order to collect tax revenue due, and to induce compliance among all taxpayers.” In fiscal
year 2022—the latest year a breakdown is publicly available—there were 197 filled, full-time positions
and 48 vacant positions.5 In comparison, in fiscal year 2008—the last fiscal year partially predating the
Great Recession—there were 297 filled, full-time positions and two vacancies.6 This reduction of 100 filled
positions since the Great Recession is important because the DRS estimates that each auditor generates $2
million a year in revenue, meaning the state is losing $200 million a year that could be used to fund critical
public investments and establish a fairer tax system.7

Second, the objective of the Wage and Workplace Standards Division in the Connecticut Department of Labor
(DOL) is to ensure that “Connecticut employees receive all the wages to which they are entitled without the
need for litigation and to enforce labor statutes that safeguard and protect the rights of workers.” However,
there were only 31 filled, full-time positions in fiscal year 2023, down from 42 filled, full-time positions in
fiscal year 2008.8 This 26 percent reduction in the number of filled, full-time positions is important because
the DOL has a months-long backlog for investigations into wage theft, which disproportionately harms
low-wage workers and increases wage inequality.9

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Figure 1. Employment Growth Since the Pandemic-Induced Recession

20%

15%

10%
Change in Employment

5%

0%

-5%

-10%

-15%

-20%

2020 2021 2022 2023

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

United States: Total Nonfarm Public Sector

Connecticut: Total Nonfarm Public Sector

*Data from the U.S. Bureau of Labor Statistics and author’s calculations.

Figure 2. Employment Growth Since the Great Recession

20%

15%

10%
Change in Employment

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-15%

-20%
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United States: Total Nonfarm Public Sector

Connecticut: Total Nonfarm Public Sector

*Data from the U.S. Bureau of Labor Statistics and author’s calculations.

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Personal Income Growth

For each quarter of the year, the U.S. Bureau of Economic Analysis (BEA) provides a measure of growth
in personal income, which includes wages and salaries, Social Security and other government benefits,
dividends and interest, business ownership, and other sources of income. In 2022, wages and salaries from
jobs plus employer supplements to wages and salaries accounted for 54 percent of total personal income in
Connecticut and 62 percent of total personal income in the U.S., meaning job growth substantially impacts
personal income growth.10 Moreover, personal income growth is especially important for Connecticut
because, as addressed below, it is the primary economic indicator impacting allowable growth in budget
appropriations under the state’s spending cap.

Two key, related findings concerning Connecticut’s personal income growth are reviewed below.

Using the pandemic-induced recession as a baseline, Connecticut’s total personal income growth through
the fourth quarter of 2022 is 4.2 percentage points lower than the growth rate for the U.S. as a whole, and
the state’s compound annual growth rate is 1.3 percentage points lower. If Connecticut’s personal income
growth had mirrored the growth rate for the U.S. over this period, the state’s budget could include on
average nearly $200 million per year in additional spending on critical public investments. Figure 3 shows
the growth in personal income in the U.S. and Connecticut from the fourth quarter of 2019, the last quarter
predating the pandemic-induced recession, through the fourth quarter of 2022.11 Over this period, personal
income growth totaled 18.1 percent in the U.S. compared to 13.9 percent in Connecticut, resulting in a
total growth gap of -4.2 percentage points for the state. Relatedly, from 2019 through 2022, the compound
annual growth rate was 5.5 percent in U.S. compared to 4.2 percent in Connecticut, resulting in an annual
compound growth rate gap of -1.3 percentage points for the state.12 For reference, the total growth rate is
measured as the total percentage change in personal income over a specified period, whereas the compound
annual growth rate accounts for the impact of compounding and is measured as the annual percentage
change in personal income if personal income had grown at the same rate every year over a specified period.

The slower growth in personal income is especially important for Connecticut because the state’s spending
cap limits the growth in budget appropriations to the level in the preceding year plus a percentage increase
based on the greater of two economic indicators: (1) the “increase in personal income,” measured as “the
compound annual growth rate of personal income in the state over the preceding five calendar years”; or (2)
the “increase in inflation,” measured as “the increase in the consumer price index for all urban consumers,
all items, less food and energy, during the preceding calendar year.”13 In general, the increase in personal
income is greater than the increase in inflation, making personal income the more important economic
indicator. For example, from 2007 to 2022, the compound annual growth rate in personal income over the
preceding five years was higher than the annual increase in inflation more than 90 percent of the time for
the U.S. and nearly 70 percent of the time for Connecticut.14

To understand more fully the impact of Connecticut’s slower personal income growth since the pandemic-
induced recession, consider the following example. As noted, Connecticut’s compound annual growth rate
for personal income was 1.3 percentage points lower than the rate for the U.S. since the pandemic-induced
recession. Applied to Connecticut’s average annual capped expenditures for fiscal years 2020 through
2023—the last two full budget cycles—an additional 1.3 percentage point increase in the spending cap
would have allowed the state to spend on average an additional $196 million per year on public investments.15

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Using the Great Recession as a baseline, Connecticut’s total personal income growth through the fourth
quarter of 2022 is 30.2 percentage points lower than the growth rate for the U.S. as a whole, and the state’s
compound annual growth rate is 1.3 percentage points lower. If Connecticut’s personal income growth
had mirrored the growth rate for the U.S. over this period, the state’s budget could include on average at
least several hundreds of millions of dollars more, and potentially billions of dollars more, each year on
critical public investments. Figure 4 shows the growth in personal income in the U.S. and Connecticut
from the fourth quarter of 2007, the start of the Great Recession, through the fourth quarter of 2022.16 This
is important historical context because it shows that Connecticut’s slower personal income growth since
the pandemic-induced recession builds upon the state’s slower personal income growth since the Great
Recession. Specifically, over this period, personal income growth totaled 82.3 percent in the U.S. compared
to 52.1 percent in Connecticut, resulting in a total growth gap of -30.2 percentage points for the state.
Relatedly, from 2007 through 2022, the compound annual growth rate was 4.1 percent in U.S. compared
to 2.8 percent in Connecticut, resulting in an annual compound growth rate gap of -1.3 percentage points
for the state.17

Again, the slower growth in personal income is especially important for Connecticut because it limits the
state’s ability to make critical public investments. As noted earlier, applied to Connecticut’s average annual
capped expenditures for fiscal years 2020 through 2023, an additional 1.3 percentage point increase in the
spending cap would have allowed the state to spend on average an additional $196 million per year on
public investments. That example, however, does not account for compounding over an extended period
and therefore understates the impact of slower personal income growth. Consider another example. If a
state had a $10 billion budget with an annual growth rate of 4.1 percent (the compound annual growth rate
in the U.S. from 2007 through 2022), the budget would total $18.27 billion after 15 years. In comparison,
if a state had an annual growth rate of 2.8 percent (the compound annual growth rate in Connecticut from
2007 through 2022), the budget would total $15.13 billion after 15 years. As a result, after 15 years, a state
with an annual compound growth rate of 4.1 percent would have an annual budget that is $3.14 billion, or
20.7 percent, greater than a state with a 2.8 percent growth rate. While this simple example does not include
all the complexities of Connecticut’s budgeting process, it shows why the state’s current $22 billion budget
could include on average at least several hundreds of millions of dollars more, and potentially billions of
dollars more, each year on critical public investments if the state’s personal income growth had mirrored
the growth rate for the U.S. since the Great Recession.

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 Figure 3. Personal Income Growth Since the Pandemic-Induced Recession

20%

Change in Personal Income 15%

10%

5%

0%

-5%

2020 2021 2022 2023

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

United States Connecticut

*Data from the U.S. Bureau of Economic Analysis and author’s calculations.

Figure 4. Personal Income Growth Since the Great Recession

90%

80%

70%

60%
Change in Personal Income

50%

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United States Connecticut

*Data from the U.S. Bureau of Economic Analysis and author’s calculations.

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Gross Domestic Product Growth

For each quarter of the year, the U.S. Bureau of Economic Analysis provides a measure of growth in gross
domestic product (GDP), which is the value of the final goods and services produced and is calculated by
adding the following components: personal consumption expenditures, gross domestic private investment,
government consumption expenditures and gross investment, and net exports of goods and services. In
2022, personal consumption expenditures—or, in more common terms, consumer spending—accounted
for 68 percent of GDP.18 This means that job growth and personal income growth—which, as addressed
earlier, are directly tied to growth in wages and salaries—both substantially impact GDP growth because
growth in wages and salaries is a major driver of consumer spending growth. Moreover, GDP growth is
especially important for Connecticut because, as addressed below, the state has a high level of long-term
obligations and when GDP grows, the tax base increases, making it easier for the state to generate the
revenue it needs to service long-term obligations while also both increasing spending on critical public
investments and providing tax cuts for low- and middle-income families to establish a fairer tax system.

Two key, related findings concerning Connecticut’s GDP growth are reviewed below.

Using the pandemic-induced recession as a baseline, Connecticut’s nominal GDP growth through the fourth
quarter of 2022 is 7.5 percentage points lower than the growth rate for the U.S. as a whole. If Connecticut’s
GDP growth had mirrored the growth rate for the U.S. over this period, the state’s GDP would be nearly
$22 billion larger, which would provide more than a billion dollars in additional revenue without raising
tax rates and could be used to pay the state’s high-level of long-term obligations while also both increasing
spending on critical public investments and providing tax cuts for low- and middle-income families to
make the tax system fairer. Figure 5 shows the nominal and real (i.e., inflation-adjusted) GDP growth
in the U.S. and Connecticut from the fourth quarter of 2019, the last quarter predating the pandemic-
induced recession, through the fourth quarter of 2022.19 Nominal GDP growth totaled 20.4 percent in the
U.S. compared to 12.9 percent in Connecticut, resulting in a growth gap of -7.5 percentage points for the
state. Moreover, real GDP growth totaled 5.0 percent in the U.S. compared to 0.4 percent for Connecticut,
resulting in a growth gap of -4.6 percentage points. If Connecticut’s nominal GDP growth had matched
the growth rate for the U.S. over this period, the state’s GDP would be $350 billion, which is $21.8 billion
larger than its actual GDP.

The slower growth in GDP is especially important for Connecticut because the state has a high level of
long-term obligations that includes bonded indebtedness, unfunded state employee and teachers’ pensions,
and unfunded state employee and teachers’ other post-employment benefits (OPEBs). Specifically, in the
2022 fiscal accountability report, the Connecticut Office of Policy and Management (OPM) estimated that
the state’s long-term obligations totaled $88.3 billion.20 Based on Connecticut’s actual GDP of $328 billion
as of the end of 2022, $88.3 billion in long-term obligation is equal to 26.9 percent of GDP. However, $88.3
billion in long-term obligation would be equal to 25.2 percent of GDP if the state’s GDP had grown at the
same rate as the U.S. since the pandemic-induced recession.

Consider another example to further understand the impact of Connecticut’s slower GDP growth. In fiscal
year 2022, Connecticut’s General Fund realized $21.5 billion in net tax revenue, which is equal to 6.5
percent of the state’s GDP of $328 billion.21 However, as noted, Connecticut’s GDP would have been $350
billion in 2022 if the state’s growth had tracked the growth rate for the U.S. In that case, Connecticut’s
General Fund would have realized $22.8 billion in net tax revenue when remaining equal to 6.5 percent of

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GDP, meaning, without raising tax rates, Connecticut would have generated an estimated $1.3 billion in
additional revenue that year that could have been used to pay the state’s high-level of long-term obligations
while also both increasing spending on critical public investments and providing tax cuts for low- and
middle-income families to make the tax system fairer.

Using the Great Recession as a baseline, Connecticut’s nominal GDP growth through the fourth quarter of
2022 is 37.9 percentage points lower than the growth rate for the U.S. as a whole. If Connecticut’s GDP
growth had mirrored the growth rate for the U.S. over this period, the state’s GDP would be nearly $89
billion larger, which would provide billions of dollars in additional revenue without raising tax rates and
could be used to pay the state’s high-level of long-term obligations while also both increasing spending
on critical public investments and providing tax cuts for low- and middle-income families to make the
tax system fairer. Figure 6 shows the nominal and real GDP growth in the U.S. and Connecticut from
the fourth quarter of 2007, the start of the Great Recession, through the fourth quarter of 2022.22 This is
essential historical context because it shows that Connecticut’s slower GDP growth since the pandemic-
induced recession builds upon the state’s slower GDP growth since the Great Recession. Specifically,
nominal GDP growth totaled 77.6 percent in the U.S. compared to 39.7 percent in Connecticut, resulting
in a growth gap of -37.9 percentage points for the state. Moreover, real GDP growth totaled 28 percent in
the U.S. compared to -1.7 percent for Connecticut, resulting in a growth gap of -29.7 percentage points. If
Connecticut’s nominal GDP growth had matched the growth rate for the U.S. over this period, the state’s
GDP would be $417 billion, which is $89 billion larger than its actual GDP.

Again, the slower growth in GDP is especially im percentage points portant for Connecticut because of
the state’s high level of long-term obligations. As noted, the state’s $88.3 billion in long-term obligation
is equal to 26.9 percent of GDP.23 However, $88.3 billion in long-term obligation would be equal to 21.2
percent of GDP if Connecticut’s GDP had grown at the same rate as the U.S. since the Great Recession.

Consider another example to further understand

the impact of Connecticut’s slower GDP growth.
As noted, in fiscal year 2022, Connecticut’s
General Fund realized $21.5 billion in net tax
revenue, which is equal to 6.5 percent of the
state’s GDP of $328 billion.24 However, as also
noted, Connecticut’s GDP would have been $417
billion in 2022 if the state’s growth had tracked
the growth rate for the U.S. since the Great
Recession. In that case, Connecticut’s General
Fund would have realized $27.1 billion in net
tax revenue when remaining equal to 6.5 percent
of GDP, meaning, without raising tax rates,
Connecticut would have generated an estimated
$5.6 billion in additional revenue in that year
alone that could have been used to pay the
state’s high-level of long-term obligations while
also both increasing spending on critical public
investments and providing tax cuts for low- and
middle-income families to make the tax system
fairer.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 14

 Figure 5. GDP Growth Since the Pandemic-Induced Recession

30%

25%

20%

15%
Change in GDP

10%

5%

0%

-5%

-10%

-15%

2020 2021 2022 2023

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

United States: Nominal GDP Real GDP

Connecticut: Nominal GDP Real GDP

*Data from the U.S. Bureau of Economic Analysis and author’s calculations.

Figure 6. GDP Growth Since the Great Recession

80%

70%

60%

50%
Change in GDP

40%

30%

20%

10%

0%

-10%

-20%
08

09

10

11

12

13

14

15

16

17

18

19

20

21

22

23
20
20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

United States: Nominal GDP Real GDP

Connecticut: Nominal GDP Real GDP

*Data from the U.S. Bureau of Economic Analysis and author’s calculations.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 15

 Overview of Wages in Connecticut
This section provides an overview of wages in Connecticut for different groups of workers and it proceeds
in three parts. The first part provides an overview of wage growth. The second part provides an overview
of wage inequality. The third part provides an overview of wage gaps.

Wage Growth

Conducted by the U.S. Census Bureau for the U.S. Bureau of Labor Statistics (BLS), the Current Population
Survey (CPS) provides data that can be used to show the variation in wage growth for workers at different
levels of the wage distribution. This data includes workers earning an hourly wage as well as workers
earning a salary, which can be transformed into an hourly wage based on the number of hours worked. The
standard approach for analyzing the variation in wage growth across the wage distribution using CPS data
is to compare the growth rate at multiple wage percentiles, generally ranging from the 10th percentile to
the 90th percentile. For reference, the 10th percentile of the wage distribution includes workers that earn as
much or more than the bottom 10 percent of workers, and the 90th percentile includes workers that earn as
much or more than the bottom 90 percent of workers. The analysis here for the U.S. follows the standard
approach. Importantly, however, the analysis here for Connecticut is limited at the top to workers at the
80th percentile because a higher percentage of the wage data for Connecticut is top-coded, which involves
capping reported wages above a certain level to a single common value to preserve the confidentiality of
survey respondents. This means that it is not possible to provide reliable estimates of wage growth for high-
wage workers in Connecticut and therefore, unfortunately, the scope of the analysis is limited to low- and
middle-wage workers.25

Several key findings concerning wage growth in Connecticut are reviewed below.

From 2019 through 2022, which covers most of the recovery from the pandemic-induced recession, wage
growth in Connecticut for low-wage workers exceeded wage growth for middle-wage workers, and wage
growth for both low- and middle-wage workers was greater on average in Connecticut than in the U.S.
as a whole. Moreover, in both the U.S. and Connecticut, wage growth for low- and middle-wage workers
generally exceeded inflation, which helped to raise the standard of living for low- and middle-wage workers,
especially low-wage workers. Figure 7 shows the real (i.e., inflation-adjusted) growth in the hourly wage
by percentile in the U.S. and Connecticut from 2019 through 2022.26 Two key, related findings here are that
over the past three years, wage growth in Connecticut for low-wage workers exceeded wage growth for
middle-wage workers, and wage growth for both low- and middle-wage workers was greater on average
in Connecticut than in the U.S. as a whole. Specifically, low-wage workers—measured here as the average
of the 10th, 20th, 30th, and 40th percentiles—had average wage growth of 4.4 percent in the U.S. and 8.8
percent in Connecticut. Middle-wage workers—measured here as the average of the 50th, 60th, 70th, and
80th percentiles—had average wage growth of 0.9 percent in the U.S. and 3.3 percent in Connecticut. The
greater wage growth in Connecticut, especially for low-wage workers, was due in part to the increase in
the state’s minimum wage. In 2019, Connecticut passed a law raising the minimum wage in steps: to $11
in October 2019, to $12 in September 2020, to $13 in August 2021, to $14 in July 2022, to $15 in June
2023, and starting in 2024 the minimum wage will increase based on the annual percentage change in
the employment cost index for wages and salaries for all civilian workers.27 Another key, related finding
here is that over the past three years in Connecticut, wage growth for both low- and middle-wage workers
exceeded inflation. Specifically, low-wage workers experienced real wage growth that ranged from 13.3
percent for workers at the 10th percentile to 5.8 percent for workers at the 40th percentile, and wage growth

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 16

averaged 8.8 percent for the group. Middle-wage workers experienced real wage growth that ranged from 5
percent for workers at the 50th percentile to 0.7 percent for workers at the 80th percentile, and wage growth
averaged 3.3 percent for the group. This real wage growth helps to raise the standard of living for low- and
middle-wage workers, especially low-wage workers, relative to before the pandemic-induced recession.

From 2021 through 2022, which covers only the more recent recovery from the pandemic-induced recession,
wage growth in Connecticut for low-wage workers generally exceeded wage growth for middle-wage
workers, and wage growth for low-wage workers, but not middle-wage workers, was greater on average in
Connecticut than in the U.S. as a whole. However, in both the U.S. and Connecticut, wage growth for low-
and middle-wage workers was generally lower than inflation, which partially offset the gains in 2020 and
2021 in the standard of living for low- and middle-wage workers. Figure 8 shows the real (i.e., inflation-
adjusted) growth in the hourly wage by percentile in the U.S. and Connecticut from 2021 through 2022.28
This provides an overview of wage growth dynamics last year, whereas the preceding analysis provided
an overview of wage growth dynamics over the past three years, which covers most of the recovery
from the pandemic-induced recession. Two key, related findings here are that last year, wage growth in
Connecticut for low-wage workers generally exceeded wage growth for middle-wage workers, and wage
growth for low-wage workers, but not middle-wage workers, was greater on average in Connecticut than
in the U.S. Specifically, low wage workers—measured here as the average of the 10th, 20th, 30th, and
40th percentiles—had average wage growth of -1.7 percent in the U.S. and -0.1 percent in Connecticut.
Middle-wage workers—measured here as the average of the 50th, 60th, 70th, and 80th percentiles—had
average wage growth of -2.4 percent in the U.S. and -2.6 percent in Connecticut. Again, the greater wage
growth in Connecticut for low-wage workers was due in part to the increase in the state’s minimum wage.
Another key, related finding here is that last year in Connecticut, wage growth for both low- and middle-
wage workers was generally lower than inflation. Specifically, low-wage workers experienced real wage
growth that ranged from 2.6 percent for workers at the 30th percentile to -2.7 percent for workers at the
40th percentile, and wage growth averaged -0.1 percent for the group. Middle-wage workers experienced
real wage growth that ranged from -2.1 percent for workers at the 60th and 70th percentiles to -3.4 percent
for workers at the 80th percentile, and wage growth averaged -2.6 percent for the group. This negative
real wage growth on average last year partially offset the gains made in the standard of living for low- and
middle-wage workers during the first two years of the recovery from the pandemic-induced recession.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 17

 Figure 7. Growth in Real Hourly Wage, 2019–2022

15%

12%

8.8%
Change in Real Hourly Wage 9%

6% 4.4%
3.3%
3%
0.9%

0%

-3%

-6%

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

United States: Average Low-Wage (10th-40th) and Middle-Wage (50th-80th) Workers

Connecticut: Average Low-Wage (10th-40th) and Middle-Wage (50th-80th) Workers

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

Figure 8. Growth in Real Hourly Wage, 2021–2022

15%

12%
Change in Real Hourly Wage

9%

6%

3%

-0.1%
0%
-2.4%
-3% -1.7%
-2.6%

-6%

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

United States: Average Low-Wage (10th-40th) and Middle-Wage (50th-80th) Workers

Connecticut: Average Low-Wage (10th-40th) and Middle-Wage (50th-80th) Workers

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 18

Wage Inequality

In addition to analyzing wage growth, the CPS wage data can be used to analyze wage inequality, which
refers to the disparity in wages for workers at different percentiles of the wage distribution. The standard
approach is to analyze both the ratio of wages for workers at the 90th percentile and 10th percentile and
the ratio of wages for workers at the 90th percentile and 50th percentile. However, as addressed earlier,
the high percentage of wage top-coding for Connecticut means that it is not possible to provide reliable
estimates for high-wage workers in the state and therefore, unfortunately, the analysis here is limited to
low- and middle-wage workers and includes 80-10 and 80-50 wage ratios.

Several key findings concerning wage inequality in Connecticut are reviewed below.

Higher real wage growth for low-wage workers compared to middle-wage workers partially reduces
Connecticut’s high level of wage inequality. However, the primary source of wage inequality in Connecticut
is the difference in wages for high-wage workers compared to low- and middle-wage workers, and data
limitations prevent an analysis of that dynamic in 2022. Figure 9 shows the high level of wage inequality
in the U.S. and Connecticut in 2022.29 In particular, workers in Connecticut made $14.40 per hour at the
10th percentile, $26.25 at the 50th percentile, and $48.08 at the 80th percentile. Put in terms of wage
inequality, workers at the 80th percentile made 3.3 times more per hour than workers at the 10th percentile
and 1.8 times more than workers at the 50th percentile. The greater real wage growth for low-wage
workers compared to middle-wage workers reviewed earlier helps to reduce wage inequality. However, as
demonstrated in previous reports, the primary source of wage inequality in Connecticut is the difference
in wages for high-wage workers compared to both low- and middle-wage workers, and the lack of reliable
estimates of wage growth and wage levels for high-wage workers means that it is not possible to provide
a more comprehensive examination of the impact of wage growth on wage inequality in Connecticut in
2022.30

Public sector jobs, which are highly unionized, are essential for reducing Connecticut’s high level of wage
inequality. Figure 10 shows the hourly wage in Connecticut in 2022 by percentile for both public sector
workers and private sector workers.31 In the public sector, workers made $15 per hour at the 10th percentile
of the wage distribution, $30 at the 50th percentile, and $45 at the 80th percentile. Put in terms of wage
inequality, public sector workers at the 80th percentile made 3 times more per hour than workers at the 10th
percentile and 1.5 times more than workers at the 50th percentile. In comparison, workers in the private
sector made $14 per hour at the 10th percentile, $25.06 at the 50th percentile, and $50 at the 80th percentile.
Put in terms of wage inequality, private sector workers at the 80th percentile made 3.6 times more per hour
than workers at the 10th percentile and 2 times more than workers at the 50th percentile. The lower level of
wage inequality for public sector workers compared to private sector workers based on both the 80-10 ratio
(3.0 compared to 3.6) and the 80-50 ratio (1.5 compared to 2.0) demonstrates that public sector jobs are
essential for reducing Connecticut’s high level of wage inequality. This is due in large part to the difference
in union coverage, which included 61.1 percent of public sector workers compared to only 7.8 percent of
private sector workers.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 19

 Figure 9. Hourly Wage by Percentile, 2022

$70

$60

$48.08 $57.68
$50

$38.75
Hourly Wage

$40
$32.00 $40.85

$30 $26.25
$22.00 $32.20
$19.00
$16.00 $26.53
$20 $14.40
$22.90
$20.00
$17.00
$10 $15.00
$12.50

$0

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

U.S. Connecticut

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

Figure 10. Hourly Wage by Percentile in Public and Private Sectors, CT 2022

$70

$60
$50.00
$50
$39.90
Hourly Wage

$40 $34.62 $45.00

$30.00
$38.46
$30 $25.15
$21.32 $31.25
$18.00
$20 $15.00 $25.06
$21.50
$18.17
$10 $14.00 $16.00

$0

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

Public Sector Private Sector

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 20

Wage Gaps

Lastly, in addition to analyzing wage growth and wage inequality, the CPS wage data can be used to analyze
wage gaps, which here refers to the disparity in wages for workers based on gender, race, and ethnicity. As
addressed earlier, the high percentage of wage top-coding for Connecticut means that it is not possible to
provide reliable estimates for high-wage workers in the state and therefore, unfortunately, the analysis here
is limited to low- and middle-wage workers for each demographic group.

Several key findings concerning wage gaps in Connecticut are reviewed below.

The gender wage gap is substantial and increases at higher wage percentiles, connecting the gender wage
gap to wage inequality. Figure 11 shows the unadjusted gender wage gap by percentile in Connecticut in
2022.32 This is measured as the amount that women earned for each dollar that men earned at the same wage
percentile and it ranged from $0.93 at the 10th percentile to $0.78 at the 80th percentile. The smaller gap
for low-wage workers is due in part to the minimum wage, which sets a floor for all workers. The larger
gap for middle-wage workers connects the gender wage gap to wage inequality, and research finds that the
increase is due in part to the disproportionate responsibilities that women tend to take on for housework
and child care compared to men, which in turn tends to decrease the relative ability of women to work long,
inflexible hours often required in middle- and high-wage professions.33

The racial wage gap is substantial and increases at higher wage percentiles, connecting the racial wage gap
to wage inequality. Figure 12 shows the unadjusted Black-white wage gap by percentile in Connecticut in
2022.34 This is measured as the amount that Black workers earned for each dollar that white workers earned
and it ranged from $0.80 at the 10th percentile to $0.65 at the 80th percentile. The smaller gap for low-wage
workers is due in part to the minimum wage, which sets a floor for all workers. The larger gap for middle-
wage workers connects the racial wage gap to wage inequality, and research finds that the increase is due in
part to occupational segregation, with white workers disproportionately occupying the highest-wage jobs.35

The ethnic wage gap is substantial and increases at higher wage percentiles, connecting the ethnic wage
gap to wage inequality. Figure 13 shows the unadjusted wage gap by percentile in Connecticut in 2022 for
Hispanic or Latino/a/x-workers compared to non-Hispanic or non-Latino/a/x workers.36 This is measured
as the amount that Hispanic or Latino/a/x workers earned for each dollar that non-Hispanic or non-Latino/
a/x workers earned and it ranged from $0.87 at the 10th percentile to $0.70 at the 80th percentile. The
smaller gap for low-wage workers is due in part to the minimum wage, which sets a floor for all workers.
The larger gap for middle-wage workers connects the ethnic wage gap to wage inequality and, similar to the
racial wage gap, it is likely due in part to occupational segregation, with white, non-Hispanic or Latino/a/x
workers disproportionately occupying the highest-wage jobs.37

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 21

 Figure 11. Gender Wage Gap by Percentile, Connecticut 2022

$1.00

$0.90 $0.93

$0.87
$0.85
$0.84
$0.80
$0.82
$0.81
$0.80
$0.78

$0.70

$0.60

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

Men Women

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

Figure 12. Racial Wage Gap by Percentile, Connecticut 2022

$1.00

$0.90

$0.86
$0.80
$0.80
$0.79
$0.76
$0.70

$0.69
$0.66
$0.65 $0.65
$0.60

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

White Black

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 22

 Figure 13. Ethnic Wage Gap by Percentile, Connecticut 2022

$1.00

$0.90

$0.88
$0.87

$0.80
$0.80

$0.70
$0.71
$0.70 $0.70
$0.68
$0.67

$0.60

10th 20th 30th 40th 50th 60th 70th 80th 90th

Wage Percentile

Non-Hispanic or Non-Latino/a/x Hispanic or Latino/a/x

*Data from EPI’s extracts of the Current Population Survey and author’s calculations.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 23

 Policy Options
This section provides policy options to support Connecticut’s economy and workers, and the policy options
are presented in four broad categories: housing, justice, employment, and taxation.

Make housing more affordable, especially by increasing the supply of housing. Making housing more
affordable will make it easier both for existing workers to stay in the state and for potential workers to
move to the state, which will increase the labor force and job growth and that in turn will increase personal
income growth and GDP growth. At the same time, it will help to offset in part the negative impact of wage
inequality and wage gaps by reducing the percentage of income that workers spend on housing. Among the
many housing policy options to support Connecticut’s economy and workers, four are highlighted here:

• Use both “sticks” and “carrots” to incentivize municipalities to promote affordable housing
development.

• Create more incentives to encourage the construction of mixed-income housing in areas close to
public transportation.

• Increase investment in the remediation of blighted properties and put them back into productive
use to benefit the communities where they are located.

• Expand the jurisdiction of public housing authorities.

For more details and policy options, see the following reports: “Addressing Connecticut’s Eviction Crisis:
Policy Options for Short-Term Reforms,” and “Addressing Connecticut’s Eviction Crisis: Policy Options
for Medium and Long-Term Reforms.”38

Provide increased support and reduce barriers to work for residents with involvement in the criminal legal
system. Providing increased support and reducing barriers to work for residents with involvement in the
criminal legal system will strengthen and increase the state’s labor force and job growth and that in turn will
increase personal income growth and GDP growth. At the same time, it will help to reduce wage inequality
and wage gaps by increasing the skills of these workers and the job opportunities available, which in turn
will increase their potential earnings. Among the many justice policy options to support Connecticut’s
economy and workers, four are highlighted here:

• Require correctional facilities to begin career planning and preparation before individuals reenter
their communities and expand work release programs.

• Limit occupational exclusionary policies to those where exclusions are necessary for job duties
and requirements.

• Ensure that eligible individuals have a driver’s license in hand upon leaving carceral facilities
and policymakers could also repeal policies that suspend or revoke a driver’s license for reasons
unrelated to driving incidents.

• Reinvest savings from reducing carceral facilities into reentry and prevention services.

For more details and policy options, see the following report: “Rolling Boulders Uphill: Rethinking Reentry
Wage and Policy Barriers Will Benefit Connecticut’s Communities and Economy.”39

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 24

Strengthen the early care and education (ECE) system and labor market more generally. Strengthening the
ECE system and labor market more generally will increase the size of the state’s labor force and job growth
and that in turn will increase personal income growth and GDP growth. At the same time, it will help to
reduce wage inequality and wage gaps, first, by increasing the pay of ECE workers—who are generally
low-wage workers and disproportionately women and workers of color—and, second, by increasing the
percentage of workers in unions, which tend to have a fairer wage distribution. It will also help to offset in
part the negative impact of wage inequality and wage gaps by reducing the percentage of income that low-
and middle-wage workers pay for ECE. Among the many ECE and broader labor market policy options to
support Connecticut’s economy and workers presented in CT Voices’ recent research, four are highlighted
here:

• Increase compensation for ECE workers while also capping co-pays to ensure that no family pays
more than seven percent of their income on ECE.

• Provide sufficient funding to fill public sector jobs.

• Require employers to provide a fair work week schedule for low-wage workers.

• Limit the ability of employers to use noncompete agreements for low-wage workers.

For more details and policy options, see the following reports: “The State of Early Childhood: Equity of
Access for Immigrant and Refugee Families,” and “The State of Working Connecticut, 2022.”40

Make the tax system fairer. Making the tax system fairer will increase the post-tax income of low- and
middle-wage workers, which will increase consumer spending and in turn GDP growth. At the same time,
it will reduce post-tax income inequality and income gaps, offsetting in part the negative impact of wage
inequality and wage gaps. Among the many tax policy options to support Connecticut’s economy and
workers presented in CT Voices’ recent research, four are highlighted here:

• Eliminate or reduce Connecticut’s tax gap.

• Eliminate or reduce high cost, high growth tax expenditures.

• Use the additional revenue to create a fully refundable Connecticut child tax credit.

• Use the additional revenue to improve the Connecticut property tax credit, especially in making it
fully refundable and available to renters.

For more details and policy options, see the following report: “The Case and Policy Options for Improving
Connecticut’s FY 2024 – FY 2025 Budget.”41

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 25

 Conclusion
The purpose of CT Voices’ annual State of Working
Connecticut report is to provide an overview of
Connecticut’s economy, especially its labor market,
to dive deeper into the status of certain workers, and
to provide policy options to support Connecticut’s
economy and workers. To that end, the report
proceeded in three sections. The first section provided
an overview of Connecticut’s economy that proceeded
in three parts: an overview of employment growth, an
overview of personal income growth, and an overview
of gross domestic product growth. The second section
provided an overview of wages in Connecticut that
proceeded in three parts: an overview of wage growth,
an overview of wage inequality, and an overview of
wage gaps. The third section provided policy options
to support Connecticut’s economy and low- and
middle-wage workers, and the policy options were
presented in four broad categories: housing, justice,
employment, and taxation.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 26

 Acknowledgements
CT Voices is a member of the Economic Analysis and Research Network (EARN), which is affiliated with
the Economic Policy Institute (EPI), a nonpartisan public policy think tank that centers the needs of low-
and middle-wage workers in economic policy discussions. As a member organization, CT Voices publishes
a State of Working Connecticut report each year using data and research from EPI and EARN as well as
other sources. We thank the staff of EPI and EARN for their support.

This report was funded by the Stoneman Family Foundation.

CONNECTICUT VOICES FOR CHILDREN: State of Working Connecticut, 2023 | 27

 References and Notes
1.  U.S. Bureau of Labor Statistics, Total Nonfarm Employment in the U.S., Seasonally Adjusted, Series ID CES0000000001;
Total Nonfarm Employment in Connecticut, Seasonally Adjusted, Series ID SMS09000000000000001. June 2023 data are
preliminary estimates published in July 2023.

2.  U.S. Bureau of Labor Statistics, Government Employment in the U.S., Seasonally Adjusted, Series ID CES9000000001; State
Government Employment in the U.S., Seasonally Adjusted, Series ID CES9092000001; Local Government Employment
in the U.S., Seasonally Adjusted, Series ID CES9093000001; Government Employment in Connecticut, Seasonally
Adjusted, Series ID SMS09000009000000001; State Government Employment in Connecticut, Seasonally Adjusted,
Series ID SMS09000009092000001; Local Government Employment in Connecticut, Seasonally Adjusted, Series ID
SMS09000009093000001. June 2023 data are preliminary estimates published in July 2023.

3.  U.S. Bureau of Labor Statistics, Total Nonfarm Employment in the U.S., Seasonally Adjusted, Series ID CES0000000001;
Total Nonfarm Employment in Connecticut, Seasonally Adjusted, Series ID SMS09000000000000001. June 2023 data are
preliminary estimates published in July 2023.

4.  U.S. Bureau of Labor Statistics, Government Employment in the U.S., Seasonally Adjusted, Series ID CES9000000001; State
Government Employment in the U.S., Seasonally Adjusted, Series ID CES9092000001; Local Government Employment
in the U.S., Seasonally Adjusted, Series ID CES9093000001; Government Employment in Connecticut, Seasonally
Adjusted, Series ID SMS09000009000000001; State Government Employment in Connecticut, Seasonally Adjusted,
Series ID SMS09000009092000001; Local Government Employment in Connecticut, Seasonally Adjusted, Series ID
SMS09000009093000001. June 2023 data are preliminary estimates published in July 2023.

5.  Connecticut Office of Policy and Management, “FY 2024 – FY 2025 Biennium Governor’s Budget: Program Addendum,” page
33.

6.  Connecticut Office of Policy and Management, “FY 2010 – FY 2011 Governor’s Biennial Budget: General Government,” page
142.

7.  Connecticut Finance, Revenue, and Bonding Committee, “Public Hearing, March 11, 2022,” discussion starts at the 1-hour mark.

8.  Connecticut Office of Policy and Management, “FY 2024 – FY 2025 Biennium Governor’s Budget: Program Addendum,”
page 124; Connecticut Office of Policy and Management, “FY 2010 – FY 2011 Governor’s Biennial Budget: Regulation and
Protection,” page 313.

9.  José Luis Martínez, “Wage Theft in CT: Millions Stolen from Workers Since 2019,” June 25, 2023; Ihna Mangundayao, Celine
McNicholas, Margaret Poydock, and Ali Sait,, “More than $3 Billion in Stolen Wages Recovered for Workers Between 2017
and 2020,” Economic Policy Institute, December 2021.

10.  U.S. Bureau of Economic Analysis, Personal Income by Major Component and Earnings by NAICS Industry (SAINC5N).

11.  U.S. Bureau of Economic Analysis, State Quarterly Personal Income Summary (SQINC1).

12.  U.S. Bureau of Economic Analysis, State Annual Personal Income Summary (SAINC1).

13.  Connecticut General Statutes, Chapter 16, Section 2-33a.

14.  U.S. Bureau of Economic Analysis, State Annual Personal Income Summary, SAINC1; U.S. Bureau of Labor Statistics, All
Items Less Food and Energy in U.S. City Average, All Urban Consumers, Seasonally Adjusted, Series ID CUSR0000SA0L1E.

15.  Connecticut Office of Fiscal Analysis, Connecticut State Budget, FY 20 and FY 21; Connecticut State Budget, FY 22 and FY
23; Connecticut State Budget, FY 23 Revisions.

16.  U.S. Bureau of Economic Analysis, State Quarterly Personal Income Summary (SQINC1).

17.  U.S. Bureau of Economic Analysis, State Annual Personal Income Summary (SAINC1).

18.  U.S. Bureau of Economic Analysis, “News Release: Gross Domestic Product (Third Estimate), Corporate Profits (Revised
Estimate), and GDP by Industry, First Quarter 2023,” Table 3, Gross Domestic Product, June 2023.

19.  U.S. Bureau of Economic Analysis, State Quarterly Gross Domestic Product Summary, SQGDP1.

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20.  Connecticut Office of Policy and Management, “Fiscal Accountability Report: Fiscal Years 2023 – 2026,” page 30.

21.  Connecticut Office of the State Comptroller, “Budgetary/Statutory Basis (GAAP Based Budgeting) Annual Report: For Fiscal
Year Ended June 30, 2022,” page 26.

22.  U.S. Bureau of Economic Analysis, State Quarterly Gross Domestic Product Summary, SQGDP1.

23.  Connecticut Office of Policy and Management, “Fiscal Accountability Report: Fiscal Years 2023 – 2026,” page 30.

24.  Connecticut Office of the State Comptroller, “Budgetary/Statutory Basis (GAAP Based Budgeting) Annual Report: For Fiscal
Year Ended June 30, 2022,” page 26.

25.  In 2022, 6.5 percent of the wage data is top-coded in the U.S. compared to 11.4 percent in Connecticut, making it not possible
to accurately estimate the 90th percentile in Connecticut. Also, for reference, in 2021, 5.7 percent of the wage data is top-coded
in the U.S. compared to 9.1 percent. On the top-code problem in general, see Elise Gould, Katherine deCourcy, and Zane
Mokhiber, “Stagnant Top-Code Thresholds Threaten Data Reliability for the Highest Earners and Make Inequality Difficult to
Accurately Measure,” Economic Policy Institute, April 2022.

26.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2019–2022; U.S. Bureau of Labor Statistics,
All Items Less Food and Energy in U.S. City Average, All Urban Consumers, Seasonally Adjusted, Series ID CUSR0000SA0.
“Wage” variable used and inflation adjustment used June as the baseline month.

27.  Connecticut General Statutes. Chapter 558, Section 31-58.

28.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2021–2022; U.S. Bureau of Labor Statistics,
All Items Less Food and Energy in U.S. City Average, All Urban Consumers, Seasonally Adjusted, Series ID CUSR0000SA0.
“Wage” variable used and inflation adjustment used June as the baseline month.

29.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2022. “Wage” variable used.

30.  See, for example, Patrick R. O’Brien and Lin Kabachia, “The State of Working Connecticut, 2022,” Connecticut Voices for
Children, September 2022.

31.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2022. “Wage” variable used.

32.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2022.

33.  Elise Gould, Jessica Schieder, and Kathleen Geier, “What is the Gender Pay Gap and is it Real?” Economic Policy Institute,
October 2016.

34.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2022.

35.  Elise Gould, “Black-White Wage Gaps are Worse Today than in 2000,” Economic Policy Institute, February 2020.

36.  Economic Policy Institute, Current Population Survey Basic Monthly Extracts, 2022.

37.  Marie T. Mora and Alberto Dávila, “The Hispanic-White Wage Gap Has Remained Wide and Relatively Steady,” Economic
Policy Institute, July 2018.

38.  Samaila Adelaiye and Madeline Sale, “Addressing Connecticut’s Eviction Crisis: Policy Options for Short-Term Reforms,”
Connecticut Voices for Children, March 2023; Samaila Adelaiye and Madeline Sale, “Addressing Connecticut’s Eviction Crisis:
Policy Options for Medium and Long-Term Reforms,” Connecticut Voices for Children, July 2023.

39.  Lauren Ruth, “Rolling Boulders Uphill: Rethinking Reentry Wage and Policy Barriers Will Benefit Connecticut’s Communities
and Economy,” Connecticut Voices for Children, August 2023.

40.  Daron Cyr, Lin Kabachia, Emily Leen, Lauren Ruth, and Jasmine Cruz, “The State of Early Childhood: Equity of Access for
Immigrant and Refugee Families,” Connecticut Voices for Children, June 2022; Patrick R. O’Brien and Lin Kabachia, “The
State of Working Connecticut, 2022,” Connecticut Voices for Children, September 2022.

41.  Patrick R. O’Brien, “The Case and Policy Options for Improving Connecticut’s FY 2024 – FY 2025 Budget,” Connecticut
Voices for Children, December 2022.

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