Hartford (February 6, 2014) – The National Federation of Independent Business (NFIB) today cautioned lawmakers that Governor Dannel Malloy’s rosy assessment of the state’s fiscal condition ignores Connecticut’s fragile economic condition.
“Every governor tries to paint a pretty picture of the economy but Governor Malloy today seemed to be describing an economy that most small businesses don’t recognize,” said NFIB State Director Andrew Markowski. “We’re not going to solve our problems by denying that they exist.”
According to the Connecticut Center for Economic Analysis at UConn in a December report, the state’s marginally better unemployment rate “is a smoke screen covering the true situation.” It concludes that while there has been slow job growth, lower unemployment in Connecticut is due mainly to residents dropping out of the workforce and not the sort of robust economy that Governor Malloy described today in his State of the State Address.
“In other words, our economy is so weak that people have given up looking for jobs,” said Markowski. “The truth is that small businesses in Connecticut are reluctant to hire because doing so is increasingly expensive and job seekers are naturally more frustrated.”
Far better than the Governor’s narrowly targeted approach that features small assistance programs for some businesses would be a pro-growth tax strategy that returns money to the businesses, consumers and investors who earned it in the first place, said Markowski.
“The Governor’s plan for the surplus is exceedingly modest and we wish he would have taken a more honest view of the state’s economy and confronted the elephant in the room,” he said. “Government at every level in Connecticut takes too much money from the private businesses that create jobs and opportunities. Instead of making people qualify to get a little of their own money back, we should be downsizing government so businesses and consumers can keep the money they earn and invest it on their own terms.”
Malloy this week surprised everyone by calling for another increase in the minimum wage only a year after having worried publicly about its impact on small businesses. He repeated that call today.
“There’s not an objective economist in Connecticut who believes that the economy has improved so sharply that another arbitrary increase in labor costs can be justified,” said Markowski. “The Governor essentially rationalized his support for another big increase on the basis of higher corporate profits. But Wall Street profits are not an indication of what’s happening on Main Street. It’s still raining on Main Street.
“It’s disconcerting for businesses that need predictability that the Governor’s economic policies seem to be so fluid,” he continued. “Small businesses spent 2013 reshaping their payroll structure to accommodate last year’s increase and now they have to go back to the drawing board. We can’t keep switching channels like this and the Governor should pick a vision and stick to it.”
To learn more about NFIB please visit www.nfib.com.