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UConn Report Says Fiscal Cliff Could be 'Disastrous' for Connecticut

The university's quarterly state economic outlook is grim.

Connecticut lost 5,700 jobs in the second and third quarters of 2012, unemployment surged and the state budget is headed for a more than $1 billion deficit for next year.

In short, Connecticut’s economy overall remained wobbly in 2012, a new report from the University of Connecticut shows, and it appears it won’t be making much of a comeback anytime soon.

“The only breaks Connecticut’s economy seems to catch these days are bad ones,” the introduction to this quarter’s The Connecticut Economy states. “Unemployment surged even as potential workers appeared to leave the labor force in droves. Cracks began appearing in what had been a rock-solid state budget. And the jobs forecast for 2013 remains tepid at best.”

To make matters worse, the report later goes on to say, Congress seems deadlocked on solving the nation’s financial woes and could end up going over the so-called “fiscal cliff” by year’s end, a situation that would hurt Connecticut’s economy even more.

“The consequences for Connecticut employment would be disastrous” if Congress doesn’t avoid the fiscal cliff, the report says. “The state could lose as many as 20,000 jobs before growth returned in 2014, with losses peaking at 5,000 in 2013-Q2. And that’s not even counting the possible defense-related job cuts a sequestration might trigger.”

There are some bright spots in the report, however. If the federal government can avoid going over the fiscal cliff Connecticut could begin to see job gains of more than 3,000 or more per quarter next year and the decline of manufacturing in Connecticut appears to be at an end, the report says.

chris December 13, 2012 at 04:02 PM
Here's a thought: how about producing and intelligent budget and sticking to it. Simple math really,.
Harry Sawyer December 13, 2012 at 09:51 PM
It's called blowback. And the Federal Reserve thinks by printing money out of thin air, will solve issues... It will only cause hyper inflation. The dollar may crash. Be prepared...
Paul Chotkowski December 14, 2012 at 02:03 AM
The fiscal cliff is not a TAX problem it’s a SPENDING problem. Does anyone truly believe that the country or the state is going to be able / willing to pay back the trillions of dollars of public debt, eliminate its current deficit spending & make good on the trillions of dollars of unrecognized / unfunded public liabilities? Forget the Mayan Calendar or Global Warming, inflation, dollar devaluation, elimination of the dollar as the global reserve currency, municipal fiscal collapses & the eventual global monetary reset are going to be much more destructive. Long before this last step there will be massive social unrest & societal dislocation. Chairman Mao Loy & our Glorious Leader BHO want to kick the can down the road long enough to put the proper infrastructure in place before massive economic pain, concern for personal safety, & fear of the future cause the Sheeple [oops should have said Proletariat] to clamor for the fundamental transformation of America. We are already at the tipping point where the Covetous Takers begin to outnumber Skilled Makers. Winter is coming. The only way to prepare is to stop spending, reduce debt, & unshackle free market capitalism. National Socialist German Workers' Party [yup the Nazis] hated the Communist and used Fascism to counter the hyperinflation incident to the death of the Weimar Republic. We have a bunch of Marxist using Crony Capitalism. A rose by any other name will be as destructive to individual liberty. I miss America!
chris December 14, 2012 at 02:49 AM
Indeed Paul, I couldn't have summed it up better. Unfortunately, the majority of the populace just doesn't seem to have the most fundamental concept of what your analysis truly implies. It may well be they are better off not knowing.....

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