Contact: Kristi Sullivan, 860-571-6213
The state’s budget crisis, and months of fiscal wrangling at the State Capitol, appears to have taken a toll on the economic outlook of Connecticut residents. Despite growing optimism about their personal financial situation, Connecticut residents are increasingly pessimistic about the state’s finances and employment prospects, and are preparing to do some personal belt-tightening as a result.
In the latest InformCT Consumer Confidence Survey, for the first quarter of 2016, the percentage of respondents who believe that the Connecticut economy is improving has dropped 10 points from the first quarter of 2015 to the first quarter this year, from just over 34% of state residents to just under 24%.
A year ago, when asked about current business conditions in Connecticut versus six months prior, 29% said conditions were better and only 22% said they were worse. That break-down has now flipped, with 22% stating “better” and 29% saying “worse.”
A majority of respondents (56%) said they intend to make some (41%) or significant (15%) cuts to their personal budget, as a result of budget cuts at the state level. Only four in 10 say that state cuts will have no effect “on me personally.” Asked what the state should do to best remedy the budget shortfall, 59% urged the state to reduce spending while 43% suggested raising taxes on the top 1% of income households, 14% supported raising taxes on businesses, and 5% agreed with raising taxes on all residents proportionately (note: respondents could chose more than one answer).
The quarterly survey is released by InformCT, a public-private partnership that provides independent, non-partisan research, analysis, and public outreach to help create fact-based dialogue and action in Connecticut. Administered by researchers from the Connecticut Economic Resource Center, Inc. (CERC) and Smith & Company, the analysis is based on the responses of residents across Connecticut and addresses key economic issues such as overall confidence, reactions to housing prices, upscale consumer purchases, leisure spending and current investments.
Other findings show the following:
Employment: Residents increasingly believe that although there are jobs available, six in 10 believe there are “not enough.” And 42% are concerned that either their job, or their spouse’s job, is in jeopardy - up from 33% in the previous quarter, and the highest level the quarterly survey has seen in the past year.
Finances: 32% of residents say they are better off than six months ago (up from 24% in the previous quarterly survey) and 44% believe they will be better off six months from now than they are today, a jump of 10 points from last quarter. More than 83% say that from a personal financial standpoint, they will be much better off, somewhat better off, or about the same, six months from now.
Quality of Life: 48% of residents continue to believe that Connecticut is a good place to live and raise a family, and only 29% disagree – a number that hasn’t budged much during the past year. Yet, the percentage of respondents who say they are likely to move out of the state in the next five years has increased to its highest level in five quarters (to 43%) after hovering between 32% and 39% in the four quarterly surveys of 2015.
Regionalism: Perhaps driven by economic necessity, the public’s view of regionalism – long an anathema in Connecticut – indicates receptivity. Over half of respondents agreed that services such as public safety, public health, libraries, education and animal control “could effectively be delivered regionally.” And 52% believe that the best way to grow the economy is to invest in local schools, transportation choices and walkable areas, versus 48% who view recruiting companies to the area as the best method.
The InformCT Consumer Confidence findings are a valuable and cost-effective strategic planning tool for any company or organization that wishes to take the temperature of the Connecticut consumer, such as financial services institutions, health care providers, insurers, developers, utilities, trade associations, and advertisers. Those who wish to subscribe to regular information can add proprietary questions for their own purposes.
More information about subscribing can be found at InformCT.org