Connecticut received a C-plus on a report card rating its manufacturing prowess ”“ but an A for the diversity of its manufacturing base, which may have helped the state in the depths of the recession as some niche industries increased employment even as others made cuts.
The report card was issued by researchers at Ball State University, who touched on a range of criteria such as access to quality workers, taxes and the global reach of manufacturers in a given state.
Connecticut was one of just five states to earn an A for the diversification of its manufacturing industries, along with Virginia, South Carolina, Mississippi and Washington. Five states received A grades for the overall health of their manufacturing sectors: Michigan, Ohio, Indiana, Iowa, and Kansas. Michigan and Indiana became poster children for the recession”™s impact on manufacturing, as automakers and producers of recreational vehicles cut back production sharply as consumer credit dried up in advance of mass layoffs.
Manufacturing production nationally was up 0.4 percent in May, according to the Federal Reserve Bank researchers, reversing an April drop. New orders for New York manufacturers appeared to drop sharply last month, marking the first time since last November an index maintained by the Fed had slipped into negative territory.
In its Empire State Manufacturing Survey that sums up conditions throughout the tristate area, the Federal Reserve Bank of New York found that manufacturers have a low level of optimism for economic conditions six months out; and while about four in 10 manufacturers surveyed said they planned to add workers in the next year, that was down from more than half who said so only in January, though smaller manufacturers generally had a better outlook on hiring.
Manufacturing employment in Connecticut contracted slightly between April and May, according to preliminary estimates by the state Department of Labor, but the 1,400 jobs added by manufacturers over the past year represents nearly a 1 percent gain. Those figures do not capture temporary workers who DOL classifies under business services ”“ that category shed fully 1,000 jobs between April and May, but remains up nearly 2 percent from a year earlier. Manufacturers likely will not bring on regular workers until a groundswell of orders materializes, according to Peter Gioia, vice president and economist for the Connecticut Business & Industry Association.
No Fairfield County manufacturer has announced a mass layoff locally since February, when Mannkind Corp. revealed it would cut 130 jobs at its Danbury plant. Sikorsky Aircraft Corp. is cutting 400 jobs in upstate New York, citing flattening orders for military helicopters, but has yet to reveal any impact on its Stratford headquarters and area offices.
If Sikorsky enjoyed boom times throughout the recession, for others that boom time is now ”“ particularly in the case of ASML NV, the largest high-tech manufacturer in Fairfield County, which makes equipment needed to etch circuitry onto computer chips and flat-panel displays. Employment at ASML”™s Wilton plant now tops 900 people, according to figures it supplied U.S. Rep. Jim Himes who recently toured the facility.
Himes is not the only public official to have reached out to area manufacturers ”“ while business groups were broadly critical of tax hikes intended to reduce state deficits and debt, Gov. Dannel P. Malloy did fend off a tax on manufacturers in the recently concluded legislative session.
“It”™s inappropriate to tax personal property of manufacturing companies,” said Benjamin Barnes, secretary of the Connecticut Office of Policy and Management, testifying against any such tax this past spring. “There are some companies that need to make huge investments in machinery and equipment, and other companies that do not; and for us to then tax companies based on whether or not they are equipment-intensive or not is illogical, and I think an anathema to economic development and job creation.
“We very much want to see companies make investments in equipment and changing the processes for manufacturing,” Barnes said. “I think manufacturing is making a comeback in the United States. I”™m more optimistic about manufacturing today than I have been in quite a number of years.”
