Connecticut lost 1,700 jobs between January 2025 and November, according to data released Tuesday by the Connecticut Department of Labor, confirming warnings from business leaders about weakening labor market dynamics in the state.
The latest employment report showed a loss of 700 jobs in October and a gain of 2,100 in November — figures released two months later due to the federal government shutdown. The report also revised September’s data, revealing a steep decline of 6,800 jobs rather than the initially reported 5,700.
The unemployment rate climbed from 3.8% in September to 4% in November, though it remained below the historical records for the state and lower than the national average of 4.6 percent.
Department of Labor Commissioner Danté Bartolomeo highlighted the shift in labor market conditions compared to recent years.
“After several years of strong job growth that created a job seekers’ market, the economy is now more competitive,” Bartolomeo said in a written statement. “It takes job seekers longer to find employment than it has in the recent past.”
This year’s data broke what the agency described as a post-COVID pattern, in which Connecticut’s labor market showed strong gains in the first months of the year and a decline in the second half of the year.
Patrick Flaherty, the department’s director of research, attributed the economic weakness to national trends.
“Looking ahead to 2026, we expect a modest growth year as long as the U.S. economy avoids an economic downturn,” Flaherty said. “Connecticut’s economy follows the nation—hiring has slowed nationally and is slowing in Connecticut as well. We’re still in positive territory, but we’re seeing indications in the private sector and across industries that growth is lagging behind last year.”
Since the beginning of 2025, the national economy has slowed its hiring but still added roughly 610,000 net jobs, in contrast to Connecticut and its neighbors Rhode Island and Massachusetts, which all registered employment declines.
National employment data have been under discussion, however. In December, the Federal Reserve cut interest rates by a quarter percentage point in a decision that revealed internal divisions within the monetary authority. The controversy stems from balancing a weakening labor market while inflation has picked up and moved away from a 2 percent annual target. Following the decision, Fed Chair Jerome Powell warned of potential systematic overcounting in employment figures, suggesting the monetary authority could continue cutting rates this year if the labor market remains weak.
“The economic picture remains mixed,” Flaherty said. “Unemployment claims remain relatively low, although initial claims are experiencing the usual uptick that we see at this time of year. The number of job postings also remains high. On the other hand, the unemployment rate has been creeping up. It was unsustainably low a year ago, so the rise may be a return to a more normal level. There is no question, however, that job growth has slowed.”
The state Department of Labor noted a decline of 19,600 in Connecticut’s labor force since January. In a statement, the agency said this could be related to federal immigration policies, as Connecticut employers rely on an immigrant workforce to offset retirements in the state’s aging population and its low birthrate. It noted that 23% of the state’s workers are born outside the U.S.
During the same period, however, the national labor force grew.
Since the start of the year, the hardest-hit sectors have been trade, transportation and utilities, with a cumulative loss of 4,900 jobs, followed by manufacturing with 1,900 and leisure and hospitality with 1,700. Government, professional business services, other services and construction showed the most growth.
Regionally, the largest employment drops since the beginning of the year were concentrated in Waterbury, New Haven and the Norwich-New London area. Hartford registered an employment increase, while Bridgeport-Stamford-Danbury showed a slight gain.
The Connecticut Business & Industry Association, the state’s largest business organization, expressed mixed feelings about the job report.
“While it’s encouraging to see the growth in November, the long-term trends highlighted by this report paint a concerning picture for Connecticut’s job growth outlook,” said Chris DiPentima, CBIA’s president and CEO. “Connecticut’s private sector job growth is essentially flat over the past 12 months.”
The business group emphasized that there were 73,000 job openings in Connecticut in October and that average wages grew compared to a year earlier.
“Employers continue to do their part to fill those positions,” DiPentima said. “These trends put an even sharper focus on the need to address affordability and workforce development in Connecticut.”
Criticism of affordability as a barrier to expanding the state’s workforce has been a recurring theme in Republican rhetoric in recent years. On Monday, Republican lawmakers reiterated these arguments in response to a U-Haul Growth Index report that ranked Connecticut 42nd among states based on the gains or losses of customers renting one-way vehicles.
Senate Minority Leader Stephen Harding, R-Brookfield, and Sen. Ryan Fazio, R-Greenwich, said the state’s growing unaffordability was driving residents away.
“We are going in the wrong direction,” Fazio and Harding wrote. “Under one-party Democrat rule, Connecticut becomes more and more unaffordable for people of all ages. From high taxes to too-damn-high electricity bills, working families are struggling, seniors are struggling and Connecticut lags behind most of the nation.”