Comptroller Natalie Braswell today, in her monthly financial and economic update, projected a General Fund surplus of $2.1 billion for Fiscal Year 2022 following a new consensus revenue forecast showing several revenue categories exceeding budgetary targets.
The jobs picture, both nationally and in Connecticut, continues to improve. The state added over 4,600 jobs in March and average weekly unemployment claims have reached a historic low. Yet high costs continue to prevent many from feeling the positive underlying trends in the economy.
“The economic data is largely positive, but the high cost of goods, including essentials like food and gas, are having a punishing effect on many Connecticut families,” said Braswell. “There are many reasons to be positive about the direction of our state’s economy and to celebrate the smart decisions that got us here, but there also remains an urgent need to help our residents weather this persistent crisis so they can fully reap the benefits of that work.”
Braswell again noted her concerns with the high cost of housing, including rent. Limited inventory for single-family homes continues to inflate sales prices, locking many out of homeownership. The number of new listings is down 20% from this time a year ago, with sales prices up 7% in the same span. Those who can’t find or afford homes of their own are facing different challenges in the rental market, where prices are up more than 12% in Connecticut from last year.
Connecticut has now recovered nearly 82% of the jobs lost at the onset of the COVID-19 lockdown. Two sectors — construction & mining, and trade, transportation & utilities — have now exceeded their pre-pandemic levels. There are more job openings nationally and in Connecticut than unemployed workers as competition for labor remains intense.
In a letter to Governor Lamont, Braswell noted that the adjusted revenue forecast, and continued strength in several key categories, resulted in a $381 million increase in her surplus projection since last month. If current projections hold, approximately $4.7 billion would be available to reduce unfunded pension liability and other types of debt.
“There’s no denying the incredible progress we’ve made in stabilizing state finances and addressing chronic budgetary problems,” said Braswell. “The state’s Rainy Day Fund is at its all-time high. We’re saving future taxpayers billions by persistently attacking decades-old pension debt. And we’re doing it in a way that will guard against future tax increases and cuts to critical services. As the end of the legislative session draws near, I encourage policymakers to not undo that progress, and instead focus on sustainable ways to improve affordability, equity and opportunity for everyone in Connecticut.”
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