Comptroller Natalie Braswell today, in her first monthly financial and economic update on Fiscal Year 2023, projected a $299 million surplus amid strong job numbers nationally and in Connecticut.
“There continues to be strong demand for labor across the nation, creating new opportunities for job-seekers,” said Braswell. “There are more job openings across Connecticut than people currently looking for work. That is creating leverage for workers and resulting in rising wages.”
Connecticut added approximately 6,500 jobs in July and has now recovered over 86% of the jobs lost during the original pandemic lockdown. Three industry sectors — construction; professional and business services; and trade, transportation and utilities — have now surpassed pre-pandemic employment levels.
Nationally, the country achieved its 19th consecutive month of job gains in July and has an estimated two open jobs for every unemployed person. Connecticut has similar levels of job availability illustrating the broad strength of the labor market.
The price of energy, particularly gasoline, declined in July, offering a much-needed reprieve from rising inflation, which remains at the highest level in decades. Consumer confidence ticked up slightly accordingly.
Connecticut’s housing market continues to experience an inventory shortage, resulting in a decrease in sales year-over-year and an increase in prices. Rental costs have risen as well, experiencing a 9% increase in the same span.
“Consumers are feeling more positive about the nation’s economic trajectory but are still grappling with high costs for necessities like food, housing and energy,” said Braswell. “As external factors, including international conflict and interest rate increases, cloud the long-term economic outlook, it’s critical that policymakers continue to search for ways to help working families afford essential needs, and maintain the momentum of recent job gains.”
In a letter to Governor Lamont, Braswell noted it is still very early in the fiscal year and projections will change. Preliminary reporting of unaudited operating results for Fiscal Year 2022 will be produced by Sept. 30.
The final FY22 volatility transfer, approximately $3 billion, will also be made later this month. Those funds are required to be deposited into the state’s Budget Reserve Fund (commonly known as the “Rainy Day Fund”). Because reserves have reached capacity, that money will instead be used to pay down pension debt. By the end of the calendar year, the final FY22 budget surplus will also be available for debt reduction.
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