2020 Connecticut Manufacturing Report - CBIA
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Connecticut
2020 Manufacturing
Report
Connecticut manufacturing
has a rich legacy of
innovation and ingenuity,
changing the course of
world history through
groundbreaking inventions.
This is where Igor Sikorksky
designed and flew the first
helicopter. Where the first
submarine took shape.
Connecticut is where—
thanks to Charles Goodyear—
the rubber first hit the road
and color television first
flickered to life.
We have a fun side, too.
Connecticut gave birth
to lollipops, Frisbees,
and Wiffle Balls.
That legacy of innovation
continues today.
We still make helicopters and
submarines. Not to mention
jet engines, cutting edge
electronics, sophisticated
medical devices, and
lifesaving medicines.
What are you going to make?
What’s your legacy?
Stanley Black & Decker
Is Proud To Support CBIA
For 175 years, Stanley Black & Decker has been for the makers and
creators, the craftsmen and the caregivers, those doing the hard
work to make the world a better place. We are focused on
delivering societal good through our innovations and business
model approach, with a heightened focus on diversity and
inclusion, environmental impact and improving the
communities where our employees live and work.
For Those Who Make The World™
©2020 Stanley Black & Decker, inc.
CONNECTICUT
MANUFACTURING’S
ECONOMIC POWER
EMPLOYEES MANUFACTURERS
155,900 3,965
Manufacturing employees
Manufacturing companies
in Connecticut
WAGES TAXES
$
17.33
BILLION
$
98,150 $
144.5 $
223.5
MILLION MILLION
Average manufacturing
Total 2019
compensation in State corporate taxes State sales & use
manufacturing
Connecticut paid in 2019 taxes paid in 2019
compensation
MULTIPLIERS
5
ADDITIONAL JOBS
$
26.74 $
2.74
BILLION
Amount generated in
What each manufacturing
Manufacturing accounted for additional activity for every
job creates in other parts
11% of the state’s GDP in 2019 $1 spent in manufacturing
of the economy
EXPORTS DEFENSE
$
15
BILLION
Manufacturing accounted
for 92% of all Connecticut
exports in 2019
$
15.2
BILLION
Connecticut
manufacturing defense
contract spending (2018)
Sources: U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics, U.S. Department of Defense, U.S. Census Bureau,
National Association of Manufacturers, Connecticut Department of Revenue Services, Connecticut Department of Labor.
FOREWORD
Connecticut has a long, storied history in precision chains, rapid shifts in demand, and liquidity challenges.
manufacturing dating back to the dawn of the Through it all, our manufacturers displayed a combination
Industrial Revolution in the United States. Over this of grit, determination, and Yankee ingenuity that has
200-plus year period, our manufacturing community served them, their employees, and our communities well.
has endured wars, a depression, countless recessions,
To date, Connecticut manufacturers have held up well
foreign competition, rapid technological changes,
compared with national averages and our regional peers.
and numerous other headwinds. The challenges
Understanding the complexities and interconnectedness
of 2020 are unique in our lifetimes.
of supply chains, and believing that our manufacturers
As the severity of the pandemic became apparent would keep their workforces healthy and safe,
in March, our manufacturers developed and rapidly Connecticut made the somewhat unusual decision to
implemented a litany of safe workplace policies deem all manufacturing essential, which allowed our
and procedures. Manufacturers were particularly companies to continue operating while other regions shut
challenged, as there is no work from home option down much of their manufacturing base. Connecticut
for most production employees. manufacturers rewarded that faith by protecting their
employees and avoiding hot spot outbreaks. They also
As the situation evolved, many businesses pivoted
continued to meet the needs of their customers and in
and retooled to use their capacity and capabilities to
many cases picked up market share from competitors.
address critical shortages of urgently needed medical
equipment and supplies. They grappled with new At the start of this year, the top concern for most
workplace mandates and juggled staffing to balance manufacturers was the shortage of skilled workers. In
the frequently competing needs of their customers and the first quarter of 2020, Connecticut reached a 10-year
their employees. They struggled with broken supply high in manufacturing employment—and we had 8,000
CONTENTS
Foreword . . . . . . . . . . . . . . . . . . . . . . . 3 Competitive Landscape . . . . . . . . . . . 8 ‘Workforce Development
Starts in Kindergarten’ . . . . . . . . . . 15
Introduction . . . . . . . . . . . . . . . . . . . . . 5 COVID-19’s Economic Impact . . . . . 10
Rebuilding Connecticut . . . . . . . . . . 16
Key Takeaways . . . . . . . . . . . . . . . . . . 7 Operating Through COVID-19 . . . . 11
Policy Recommendations . . . . . . . . . 18
Portrait of the Manufacturer . . . . . . 7 Workforce & Hiring . . . . . . . . . . . . . . 14
Key Stakeholders . . . . . . . . . . . . . . . 19
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 3
to 10,000 manufacturing positions open for want of
skilled candidates. Since that time, our manufacturing
workforce is down by over 4% but recent monthly trends
show slow, albeit inconsistent, improvement. While it will
take some time to regain the jobs lost to the pandemic
and the subsequent recession, the age of the Connecticut Food, beverage,
tobacco
manufacturing workforce will continue to drive high levels products
of retirement and thus the need for new entrants. Electrical
equipment & Plastic & rubber
appliances products (2%)
In addition, this shift in our manufacturing workforce as
Motor vehicles
older, more experienced workers retire and early career, & parts (2%)
less-skilled candidates enter the workforce—coupled
6% 5
%
with the rapid advent of new technology—underscores
the need to focus on incumbent worker training. 7%
Machinery
Other areas of focus for 2021 and beyond 7%
include access to capital for manufacturers,
Computer
& electronic CONNECTICUT 29%
Aerospace &
parts
select opportunities for regulatory reform, and MANUFACTURING transportation
the acceleration of the digital transformation JOBS BY
of our manufacturing industries though the
9% INDUSTRY
Miscellaneous
adoption of Industry 4.0 technologies. In Source: U.S. Census Bureau
addition, exciting opportunities are evolving in
emerging industries including electronic vehicles,
offshore wind power, and bioscience.
15%
In the near term, there is still a significant amount
Fabricated
metal products 18%
Chemicals
of uncertainty in many manufacturing sectors, but
most Connecticut manufacturers are more focused
on the opportunities ahead than the risks. Innovation,
determination and optimism are alive and well in our
manufacturing ecosystem, which will serve us well
as we emerge from these unprecedented times.
Colin Cooper
Chief Manufacturing Officer, State of Connecticut
4 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T
INTRODUCTION
The 2020 Connecticut Manufacturing Report, produced concerns, and new operating costs abound as disaster
by CBIA and affiliates CONNSTEP and ReadyCT—and relief loans are exhausted.
made possible through the generous support of Stanley
While most Connecticut manufacturers’ doors remain
Black & Decker—reviews the state of the sector, explores
open, the crisis is taking its toll.
the outlook for the next 12 months, growth factors, key
initiatives, hiring and investment trends, and the impact More than 56% of surveyed manufacturers report they
of state and federal policies. had to lay off, furlough, or reduce employee hours as
a result of the pandemic. The sector lost 11,700 jobs in
It also captures how the state’s manufacturing community
March and April—7% of the pre-pandemic workforce,
is navigating an extraordinarily challenging and
while 17% of all jobs
unprecedented period,
were lost in the
with the world looking
same period.
very different today
than it did when this Through
report was published 1st September
last year. 29% 2020, 43%
5th 2nd of those
As of mid-October,
19% 18% manufacturing
more than 61,700
workers had
state residents
returned to
have contracted 3rd
work, with
COVID-19 and
24% the state
over 4,500 have 4th
recovering 61%
died. There 10% Connecticut manufacturing jobs of the overall
have been
by congressional district 291,300 jobs
almost eight
Source: U.S. Census Bureau lost in the first
million cases
two months of
nationwide and
the pandemic.
the national death toll
exceeds 216,000—20% of the global figure. Connecticut’s GDP contracted 31.1.% in the second quarter
of 2020, ranked 23rd in the country, weathering the
While Connecticut has responded to the pandemic better
pandemic slightly better than the New England region
than most states, businesses are operating at reduced
overall, which declined 32.3%. U.S. GDP fell 31.4% in the
capacity, global demand for many products is sagging,
second quarter.
employees are struggling with health and childcare
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 5
n Made no changes (25%) n Hired additional
employees (7%)
How COVID-19 n Reduced employee
CUT HOURS, hours (23%) n Increased employee
restrictions FURLOUGHS,
n Furloughed employees hours (5%)
impacted LAYOFFS
(17%) n Other (5%)
workforce
decisions
56% n Laid off employees (16%) n Not applicable (1%)
Source: CBIA July 2020 Connecticut manufacturing survey
When the state’s initial COVID-19 restrictions went into The sector will play a key role as businesses lead the
effect in mid-March, manufacturing was declared state’s recovery.
essential, allowing the sector—a critical component
Our producers are navigating a slow return to normal
of the state’s economy—to remain in operation.
in a significantly weakened economy, grappling not
State and federal relief programs, including the Payroll only with supply chain interruptions and the cost of
Protection Program and the paid leave benefits enacted government regulations and mandates—including
in the Coronavirus Aid, Relief, and Economic Security Act potentially devastating increases in unemployment
and the Families First Coronavirus Response Act, also insurance and workers compensation—but the
played major roles helping deflect greater economic widespread uncertainty about the pandemic’s long-term
damage. health and economic impacts.
The resiliency, innovative spirit, and unselfishness of Add to this the national political landscape and projected
Connecticut manufacturers also must be emphasized. multi-billion dollar state budget deficits, it’s a safe bet
In the early weeks of the pandemic, with COVID-19 cases they are not getting much sleep.
and hospitalizations surging and personal protective
The information and data shared in this report came from
equipment and medical supplies in short supply,
multiple sources, including a comprehensive July 8-29
manufacturers responded.
CBIA survey of Connecticut manufacturers, numerous
Manufacturers across the state pivoted, retooling state and federal agencies, and interviews with private
production lines to make PPE, surgical gowns, ventilators, and public sector manufacturing leaders and officials.
hospital beds, and other desperately needed supplies.
Given the critical part manufacturers play in Connecticut’s
Small and large businesses donated resources, products,
economic ecosystem, the key takeaways and policy
services, and millions of dollars to relief efforts. The state’s
priorities highlighted in this report are ones their partners
bioscience sector went into overdrive in the search for
in the state legislature and government agencies should
treatments and a vaccine.
understand and embrace.
6 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TKEY TAKEAWAYS PORTRAIT OF THE
f More than half (56%) of manufacturers had to lay
MANUFACTURER
off, furlough, or reduce employee hours as a result Connecticut manufacturers are typically small,
of the pandemic experienced employers. Almost 72% of those who
responded to CBIA’s July survey employ fewer than 50
f Manufacturers implemented additional, voluntary
workers; 87% have less
health and safety
than 100 employees.
precautions to
Where does your company currently
protect employees
make its greatest investment? The average age
and prevent of those surveyed
workplace Employee
training
20% companies is 53 years,
transmission of with almost 93% having
Property &
the coronavirus facilities
20%
been in operation for
f 85% of surveyed New technology 19% more than 20 years.
manufacturers Only five respondents
Other capital
assets
13% have been in business
applied for a federal
PPP loan, with 97% Research & for less than 10 years,
development
12%
of those applications and 23 are more than
Recruiting
successful qualified workers
9% 100 years old.
f Less than half (46%) Other 7% Almost one quarter
expect to return a (24%) of surveyed firms
Source: CBIA July 2020 Connecticut manufacturing survey are privately held, 20%
profit in 2020, down
30 percentage points are incorporated, 20%
from 2019. are S corporations, 7% are limited liability corporations,
2% are publicly held, and 1% are foreign-owned. Twenty
f Only 18% of respondents said their businesses were
percent are family-owned businesses, 7% are owned by
growing, while 82% said they were either contracting
women, 5% by veterans, and 1% are minority-owned.
or holding steady.
According to U.S. Census Bureau data, aerospace and
f More than half expect employment levels to remain
transportation are responsible for the largest percentage
stable over the next six months, with 20% forecasting
of Connecticut’s manufacturing workforce, responsible
growth and 23% a decline
for 29% of industry employment.
f The outlook for both the state and national economies
Chemical manufacturers represent 18% of total
is soft—only 10% expect the Connecticut economy to
manufacturing employment, followed by fabricated
expand next year, with 32% forecasting national growth
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 7metal products (15%), computer and electronic parts (7%), Connecticut manufacturers pay more than $368 million
machinery (7%), food, beverage, and tobacco products annually in state corporate and sales and use taxes and
(6%), electrical equipment and appliances (5%), plastics and invest almost $1.5 billion in capital expenditures each year.
rubber products (2%), and motor vehicles and parts (2%).
Most critically—the sector drives other parts of the state’s
Connecticut manufacturers are both loyal and local. economy, creating up to five additional jobs for every
Ninety-seven percent of surveyed companies have their manufacturing job and generating $2.74 in additional
primary facility in Connecticut, and 86% of the state’s economic activity for every dollar spent.
manufacturers make their products here.
They invest in their people, first and foremost. Employee COMPETITIVE LANDSCAPE
recruitment, training, and retainment are where they
While Connecticut has been home to most of these
make their greatest investments, followed by property and
producers for decades, their presence should not be
facilities, technology, and research and development.
taken for granted.
As of August 2020, the state’s 3,965 manufacturers employ
When asked about the greatest advantage to running
154,700 workers—10% of Connecticut’s workforce—and
a business in Connecticut, manufacturers responded
pay an annual total of $17.33 billion in wages and benefits.
that quality of life (25%), proximity to customers (25%),
That’s an average of $98,150, well above the state’s
and a skilled workforce (24%) are primarily what keep
$74,561 yearly per capita income.
them here.
Manufacturing contributed $26.74 billion to the state’s
Excluding the coronavirus pandemic, the increasing cost
economic output last year, 11% of Connecticut’s annual
of complying with state regulations and mandates is the
gross domestic product, including over $15 billion in
main factor hampering the growth of the manufacturing
exports and more than $15.2 billion in defense contracts.
sector, cited by 23% of survey
respondents.
Quality of life 25%
Twenty percent said the difficulty finding
Proximity to
customers
25% skilled labor was the primary obstacle,
followed by the state’s high cost of living
Skilled workforce 24%
(16%), the uncertainty and unpredictability
Family/roots 7% of legislative decision-making (15%), and
What’s the greatest high business taxes (13%).
Other 7% advantage to running a
business in Connecticut? Small manufacturers, those with fewer
Access to
major markets
6% than 100 employees, were more likely
Source: CBIA July 2020 Connecticut
manufacturing survey to view the state’s business climate
None 6%
8 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R Tnegatively—perhaps a reflection Excluding the pandemic, what’s the main factor
of 2019 legislative actions, hampering your ability to grow in Connecticut?
including the paid family
State regulatory/mandate
and medical leave mandate, compliance costs
23%
expanding the sales tax to
Availability of skilled workers 20%
PPE and safety apparel, and
reducing the pass-through entity State’s high cost of living 16%
tax credit. The latter costs small Uncertainty/unpredictability of
businesses $53 million annually. legislative decision-making
15%
When asked whether they
High business taxes 13%
approve of the state legislature’s
Other 9%
handling of the economy and
job creation, 51% of surveyed Transportation infrastructure 2%
Source: CBIA July
manufacturers said they 2020 Connecticut
Credit availability 1% manufacturing survey
either disapprove or strongly
disapprove. Thirty percent
were neutral and 19% said they
manufacturing company. “Actually, it is very sad for
approved.
those that the legislators say they are trying to help.
Almost two-thirds of (63%) believe the state’s business
“We will now blame the impacts of COVID-19 for the
climate is declining, with 30% describing it as static,
economic problems, which is only partially true. The
and 7% saying it is improving.
state’s finances are simply unsustainable and we will
“After thirteen years [as CEO] it is clear that striving to end up declaring bankruptcy at some point over the
create jobs and grow the economy of our state is not next decade.
a priority,” responded the chief executive of a major
“For growth we need to increase employment and
productivity. However, our working age
population is declining and we do not
General Assembly ratings:
Economy & job creation encourage investment, so the math
simply does not work.”
n Strongly n Somewhat
DISAPPROVE approve (2%) disapprove (23%)
Nearly half of all companies say they have
51% n Somewhat
approve (17%)
n Strongly
disapprove (28%)
been approached by another state about
relocating or are independently considering
n Neutral (30%)
a move.
Source: CBIA July 2020 Connecticut
manufacturing survey
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 9CONNECTICUT U.S. Manufacturing growth outlook
n Strong growth (0%, 3%)
n Moderate growth (10%, 29%)
CONTRACTION CONTRACTION n Static (30%, 23%)
60% 46% n Moderate contraction (40%, 31%)
n Strong contraction (20%, 15%)
Source: CBIA July 2020 Connecticut
manufacturing survey
As for states that have proactively solicited Connecticut
COVID-19’S ECONOMIC IMPACT
manufacturers, South Carolina tops the list, followed
by Florida, North Carolina, and Texas. Many Although now a distant memory, 2019 was a strong year
manufacturers report solicitations from multiple states. for most Connecticut manufacturers, with 76% of surveyed
firms reporting a profit last year, up slightly from 75% in
According to survey respondents, business friendliness
2018. Thirteen percent reported breaking even, and 11%
and lower taxes were the top reasons for considering
posted losses.
a move (76%), followed by proximity to customers (14%)
and cost of labor (10%). More than half (53%) pointed to a strong national
economy and increased sales as the reason for their
Asked about their outlook for the Connecticut economy,
profits, while 41% credited their own strategic decisions.
60% expect a contraction over the next 12 months,
Approximately 5% identified federal government spending
including 20% who project a strong decline in growth.
and contracts as the reason for their growth.
Only 10% see the state’s economy growing in the next year
and 30% expect economic conditions to remain static. While roughly half of those who lost money in 2019
pointed simply to decreased sales, nearly 30% reported
Their expectations for the national economy are more
that input prices, mainly labor and materials, were the
optimistic, with 32% expecting growth, 46% a contraction,
key factors driving losses.
and 23% predicting static conditions.
2019 2020
n Profit (76%, 46%)
Manufacturing PROFIT PROFIT n Break even (13%, 26%)
profitability
sector 76% 46% n Loss (11%, 28%)
Source: CBIA July 2020 Connecticut
manufacturing survey
10 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TDespite the COVID-19 crisis and lockdowns crippling the ”We repurposed one factory and started making PPE,”
world at the end of the first quarter and well into the said one manufacturer. “We are trying to sustain this
second, nearly 53% of respondents said they still managed business by creating a new company division.”
to turn a profit for the first half of the year.
Others changed up their business models. One
However, as of July, only 18% said their businesses were Connecticut brewery, forced to close its taproom, offset
still growing, while 82% said they were either contracting some of the revenue losses by moving to curbside takeout.
or holding steady.
Pandemic-driven changes in consumer behavior
Only 46% of Connecticut manufacturers now anticipate are also causing significant disruptions, as another
a profit for 2020 (versus 76% in 2019), while 28% are survey respondent explained: “We are a cosmetic raw
forecasting losses, compared with 11% last year. material supplier to the major cosmetic manufacturers
Twenty-six percent expect to break even this year. and with people working from home, not going out,
and the face mask requirement, there was a big drop
The aerospace sector, which accounts for the largest
in cosmetic sales.”
percentage of manufacturing employment, is taking
an outsized hit this year because of the dramatic decline Less than half (45%) of surveyed manufacturers
in commercial air travel. introduced a new product in the last 12 months, while
40% said they plan on introducing a new product in the
A number of those who responded to CBIA’s July survey
coming year. One-quarter (25%) are unsure about their
are part of the supply chain for larger companies.
new product plans and 35% will not launch a new product.
“We manufacture aircraft parts and worked through the
Seventy-nine percent of those rolling out new products
toughest months until July 2020,” noted one manufacturer.
in the coming year will manufacture them in Connecticut,
“We put almost all our employees on unemployment due
13% will locate partial production here, 4% will produce
to being impacted by no flights flying and we have seen
elsewhere, and 3% are uncertain.
an 80% decrease in our work load.”
Those who make consumer products also struggled, with
lockdowns and restrictions in place across the country.
OPERATING THROUGH
Noted one producer: “Our largest customer was closed
COVID-19
for 10 weeks. And the closing of retail shops and malls Most Connecticut manufacturers’ doors stayed open
negatively affected our company as our products are throughout the pandemic. Nonetheless, operating
often sold through traditional brick and mortar.” through significant disruptions and restrictions has been
incredibly difficult.
Many manufacturers pivoted, retooling production lines
to make PPE, surgical gowns, ventilators, hospital beds, It is clear from responses to the July survey that the
and other urgently needed supplies. pandemic is taking its toll on employees and employers
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 11alike—from the daily grind of complying with health and
Did your
company safety guidelines, to the ongoing issues with childcare
introduce a new and the growing uncertainty about the future.
YES
product in the
45% past 12 months? “This pandemic has created a significant stress on all
our employees,” noted one respondent. “From stresses
n Yes (45%)
of working from home, educating their children full-time
n No (55%)
while working from home, concerns for their health and
well-being and that of their family, travel restrictions
and state shutdowns, and the looming uncertainty of
Will you
when it may end.
introduce a new
product in the “While we have not had any COVID-19 cases with
YES
next 12 months?
40% n Yes (40%)
employees, we have had to address many other health
issues arising from the stress and duress of daily living
n No (35%) in this new normal.”
n Unsure (25%)
Economic weakness and reduced demand have
impacted the revenues of almost two-thirds of companies
(65%), while new health and safety protocols, employee
Are your
products concerns, and supply chain interruptions have driven up
manufactured costs and challenged production.
YES
in Connecticut?
86% n Yes (86%)
While some manufacturers capitalized on new
opportunities and hired additional workers to meet
n Partially (13%)
pandemic-related demand, most (56%) reported having
n No (1%)
to reduce employee hours, execute layoffs, or furlough
employees.
Will your new State and federal emergency relief programs helped
products be made mitigate further workforce losses.
in Connecticut?
YES Eighty-five percent of surveyed manufacturers applied
79% n Yes (79%)
n Partially (15%)
for a PPP loan and 97% of those applications were
approved. Of those who received PPP funding, 91% said
n No (4%)
they met their employee retention goals, 5% were unsure,
n Unsure (3%)
and 4% were unsuccessful.
Source: CBIA July 2020 Connecticut manufacturing survey
12 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TOf those who did not apply for a PPP loan, 54% said they to separate teams during the workday.
did not require government financing, 24% were ineligible,
In addition to complying with Connecticut’s COVID-19
and 16% either applied for other federal programs or
guidelines—including mandatory masks or face coverings,
were wary about applying. Five percent accessed private
social distancing, cleaning and sanitation protocols, and
financing sources.
capacity limits—manufacturers implemented additional
Only 18% of surveyed firms health and safety
applied for state pandemic measures.
assistance, including the
Forty-three percent of
Recovery Bridge Loan
Did you apply survey respondents carry
program administered
YES for a PPP loan? out temperature checks
85%
by the Department of
n Yes (85%) for employees and
Economic and Community
n No (15%) customers, 27% conduct
Development.
regular health screening
As for working remotely checks, 10% test workers
during the pandemic, 55% for COVID-19, while
of companies said at least Was your 20% adopted other
some of their employees application measures, including
YES
were able to work offsite. successful? air quality monitors,
For those respondents, 97% n Yes (97%) improved ventilation,
an average 23% of their n No (3%) and sophisticated air
workforce clocked in from purification systems.
home during the initial
With a nascent recovery
months of the pandemic. Did the loan
underway, 37% of
allow you to meet
At the time of the survey, your employee manufacturers report
YES
manufacturers reported retention goals? they are having difficulty
an average of 13% of their 91% n Yes (91%)
getting employees to
workforce was still remote, return to work, citing the
n No (4%)
and 9% anticipated that n Unsure (5%) $600 temporary weekly
employees would continue federal unemployment
working remotely. Source: CBIA July 2020 Connecticut manufacturing survey benefit, health concerns
related to potential
Many also staggered shifts
exposure to COVID-19,
to reduce the number of
and childcare issues as the primary factors.
onsite employees or created cohorts within their facilities
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 13WORKFORCE & HIRING Is your workforce…
While uncertainty around the coronavirus pandemic n Growing (20%)
STAYING
THE SAME n Staying the same (56%)
and ongoing concerns with the direction of the state’s
economy are largely responsible for that trend, 56% n Declining (24%)
Source: CBIA July 2020
Connecticut continues to face a critical shortage of
Connecticut manufacturing
skilled workers, compounded by a shrinking labor survey
force, population loss, retirements, and the state’s
high cost of living.
21% increasing employment levels, 15% expanding remote
That shortage is felt most acutely in manufacturing.
work, 14% employing fewer workers, and 13% relying
It’s a significant concern, particularly
more on part-time and temporary
as the state’s skilled workforce is seen
employees.
as a major competitive advantage—
and manufacturers tell us the difficulty Forty-eight percent of manufacturers
finding talent is also one of the report challenges finding and retaining
MORE
primary obstacles to growth. AUTOMATION young workers. Just 25% say they have
Connecticut is one of the oldest states 27% no trouble finding and retaining young
workers, 22% have issues only with
by average age. Manufacturers say
attracting younger workers, and 4%
41% of their workers are 40 years old
only with retaining them.
or younger, while 25% of managers are
What post-COVID
40 years old or younger, with 11% of The main obstacles for finding
workforce changes
the current workforce expected to qualified young workers include a lack
do you anticipate
of skills or expertise (40%), proper work
retire between 2021 and 2024. making?
ethic (28%), competition from other
Only 20% of surveyed manufacturers n More automation (27%)
employers offering higher wages and/
expect to increase their workforce n Add jobs (21%)
or more expansive benefits (16%), and
over the next six months. More than n Expand remote work
(15%) the state’s high cost of living (10%).
half (56%) say employment levels
n Fewer jobs (14%)
will remain stable and 24% expect State government has placed a
n More part-time,
a decrease. growing emphasis on workforce
temporary
employees (13%) development, including driving the
Manufacturers also expect to make
n Other (10%) consolidation of many of the different
operational and workforce changes
Source: CBIA July 2020 initiatives across Connecticut to better
in the post-COVID environment, Connecticut manufacturing
leverage resources and opportunities.
survey
with 27% adopting more automation,
14 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T“We want to expose children to the “Students in underserved populations
‘WORKFORCE world of work by middle school, then in some cases don’t have people in
DEVELOPMENT build out career pathways by high their lives who have meaningful jobs.”
STARTS IN school,” she said.
Vallieres also stressed the need
KINDERGARTEN’ Vallieres also oversaw the council’s for workforce development for
recent completion of a strategic plan adult populations, including the
T
he head of the state’s new for next year, which will guide her underemployed and underskilled
workforce development office office’s efforts. who need to be reskilled.
said Connecticut must begin its The plan puts industry at the center Vallieres singled out child care as
workforce development efforts early as the customer and the student as an example of a barrier.
if it’s going to meet the manufacturing the product for that customer.
“The child care system was broken
industry’s demand for thousands of
“We’re undergoing a solid detailed before the pandemic,” she said.
skilled workers.
process to implement this plan,” she “It discourages people to engage in
“Workforce development starts said. “Some things are a multiyear work because everything they make
in kindergarten,” said Kelli-Marie initiative, some are intermediate, and goes to child care. That’s even if they
Vallieres, director of the new office some short term.” can find child care.”
tasked with coordinating Connecticut’s
One of the first steps is getting Vallieres points to her own experience
various workforce development
state agencies to work together on as a young working mother.
programs.
workforce development efforts, which
“After I had my second child I was
“Students are the product of the will happen through better data
making $50 a week after childcare,”
system and we have to produce management, then breaking down
she said. “You ask yourself, ‘Is it really
a product that industry needs.” barriers to entry into the workforce,
worth it?’”
Vallieres was an established leader in she said.
Vallieres likes to quote West Hartford
Connecticut manufacturing when Gov. “The data management systems
business leader Ari Santiago when
Ned Lamont tapped her this summer to are old and don’t talk to each other,
discussing the differences between
serve as executive director of the new so making data-driven decisions is
Workforce Development Unit within manufacturing 40 years ago and today.
difficult to do across departments,”
the Department of Economic and Valllieres said. “Ari says, ‘We used to think of
Community Development. manufacturing as dark, dingy and
“We have a system that integrates
The new office will coordinate dirty. Today, it’s clean, lean, and
some data but it’s not intuitive.
workforce development policy, green,’” she said. “Also, ‘You used to
including training, education, “But there’s work going on, things have to use your brawn. Now you
and worker placement. happening to improve systems, have to use your brain.’”
including a big focus on our data
Vallieres continues serving as vice chair That’s because the lines that
management system.”
of the Governor’s Workforce Council, a separate IT, computer science, and
position she’s held since October 2019. She said state agencies are partnering manufacturing are disappearing,
in the workforce development effort Vallieres said.
In the short time since she began, and “starting to put their arms around
Vallieres has immersed herself in “Running those machines is running
the magnitude of this and working to
her new job. computers, plus you have the quality
make improvements to the system.”
control aspect that’s computerized
“We’re getting a lot of momentum The state must also address equity and and statistical,” she said. “It makes
about introducing workforce access to workforce development for it exciting.
development into our curriculum,” underserved populations, she said.
she said. “The next industrial revolution is going
“There’s a lot of work to be done to to revolve around artificial intelligence
She envisions a curriculum that not remove those barriers and a lot of and smart factories, and we won’t lose
only teaches math, science, reading, funding that needs to go into these jobs, we’ll improve the quality of them.
and writing but provides students programs,” she said.
with concrete examples of how those “That’s why we need to start focusing
lessons are used in various professions. “We must also address the equity on the children in school today. They
gap for underserved populations.” will be our workforce of the future.”2019 2020
n Both (56%, 48%)
Is it difficult n No difficulty (15%, 25%)
to find and/or BOTH BOTH n Finding only (19%, 22%)
retain young 56% 48% n Retaining only (10%, 4%)
workers?
Source: CBIA July 2020 Connecticut
manufacturing survey
For instance, in July, the Lamont administration established additional financial recovery assistance, 15% called
the Connecticut Workforce Unit, appointing manufacturing for an easing of restrictions and shutdowns, 14% cited
CEO Kelli-Marie Vallieres [see page 15] to lead the less government interference in the private sector, and
office, which will work with private and public sector 9% pushed for policies that will support and improve
stakeholders on a statewide workforce development plan. economic growth.
“The state has been fairly good thus far in proactive
REBUILDING CONNECTICUT responses to the virus, even though some have been
quite painful for many businesses,” responded one
Pandemic aside, manufacturers have a laundry list of
manufacturer. “They are necessary for public health
factors inhibiting growth and job creation in Connecticut.
and well-being as the numbers are beginning to show
When forced to pick just one, it was a near toss-up in Connecticut versus other more careless states.
between the scarcity of skilled labor, onerous and
“For the longer term, state spending and unfunded
expensive regulations, the high cost of living in the
liabilities must be strongly dealt with to reduce the tax
state, uncertainty and unpredictability of legislative
and regulatory burdens on businesses so that a better
decision-making, and tax burden.
environment for recovery is created.”
Manufacturers were asked what additional assistance
Said another: “Being closed was a huge challenge. In the
the state government could provide to help companies
event we have to close again, that is where we will need
rebuild. Their responses were illuminating, as they spoke
help. As for helping small businesses, the only way to help
more to the conditions that hampered Connecticut’s
is to support them. Buy local, support Connecticut.”
recovery from the last recession than the pandemic.
We also asked manufacturing leaders to identify the top
Those structural conditions remain and clearly concern
policy priority for lawmakers in the General Assembly’s
manufacturers. For instance, 39% called for cutting
2021 session.
government spending and lowering taxes, 25% wanted
16 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TForty-three percent called for prioritizing state spending As Connecticut charts its economic recovery, it’s clear the
controls (including pension reforms), 27% supported lower state needs a new way of thinking, a truly collaborative
taxes or tax reforms, 14% identified business-friendly approach between the public and private sectors that
policies, 12% called for better COVID-19 safety compliance focuses on nurturing businesses and promoting and
guidance and training, and 5% want more policies driving driving job and economic growth.
economic growth and job creation.
Connecticut can rebuild its economy and get people
Connecticut policymakers must better understand the back to work.
obstacles to growth faced by the state’s manufacturing
Let’s seize the moment to capitalize on the state’s many
sector and demonstrate support for this critical
strengths and not only restore our economy, but make
component of our economy.
it more vibrant and robust than ever.
The task ahead is a daunting one. Rebuilding
It’s time to support policies that will help manufacturers—
Connecticut’s economy is a challenge unlike any we
particularly small manufacturers—manage the high cost
have faced in modern times, one that can only be met
of navigating COVID-19 restrictions, create and retain
by dramatically reshaping the relationship between
jobs, and lead the state’s economic recovery and growth
job creators and government.
for the benefit of all.
Reduce state spending/
pension reform
43%
Lower taxes/reforms 27%
Business friendly policies 13%
COVID safety compliance
12% What should be the top priority for
guidance/training
the 2021 General Assembly session?
Job creation/
economic growth
5% Source: CBIA July 2020 Connecticut manufacturing survey
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 17f Leverage public-private partnerships to speed
POLICY RECOMMENDATIONS
planning and completion of priority transportation
projects, additional infrastructure projects such as
Workforce Development
critical bioscience laboratory space, and revitalize
f Tailor workforce development programs to prioritize and grow the economies of our cities
high-value, in-demand industries—such as aerospace,
software engineering, medical devices, biopharma, Small Business Relief
and fintech—and focus on defined pathways for
f Repeal the 6.35% state sales tax on employment
educational and career development
training and safety apparel,
f Streamline the professional licensing including personal protective
process, remove barriers for equipment
apprenticeship training requirements, These policy
recommendations Restore the pass-through entity
and recognize equivalent out-of-
form the framework tax credit to its original 93%—the
state licenses for those moving here of CBIA’s Rebuilding
2019 reduction costs small businesses
to increase workforce strength Connecticut pledge.
As of mid-October, $53 million annually
f Expand the state’s manufacturing
more than 120 state
Restore the R&D tax credit to
apprenticeship tax credit program elected officials
attract entrepreneurs, foster startup
to include small manufacturers and candidates
have signed the businesses, and promote private
and repeal the state sales tax on
pledge, which is sector investment
employer training programs
also supported by
over 95 businesses
Urban Renewal and organizations Taxpayer ROI
from around the
Deliver greater value to taxpayers
f Drive much-needed investments in state. Learn more
by expanding the use of nonprofit
our cities and towns by overhauling at rebuildct.com.
organizations to deliver state
environmental remediation statutes and
services, implementing broad-based
regulations, streamlining permitting,
technology solutions, cutting
cutting red tape, and conforming
duplicative state functions, and
state rules with federal standards
eliminating overtime and mileage
in pension calculations
Infrastructure Investment
f Restore the long-term financial sustainability of the
f Support a bipartisan transportation funding plan
state’s Unemployment Trust Fund through the adoption
that provides the necessary resources to rebuild and
of benefit reforms already implemented as best
modernize Connecticut’s infrastructure while protecting
practices by neighboring states
Special Transportation Fund revenues
18 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TKEY STAKEHOLDERS
AdvanceCT is collaborating with numerous stakeholders
ADVANCECT
to develop a strategic plan for Connecticut’s economic
AdvanceCT future, including ensuring Connecticut has a properly
is a nonprofit trained workforce, today and in the future.
organization that works to engage, retain, and
Visit advancect.org
recruit businesses and advance overall economic
competitiveness in Connecticut.
Through its close partnership with the Department of CONNECTICUT DEPARTMENT
Economic and Community Development, AdvanceCT
OF ECONOMIC & COMMUNITY
is enhancing Connecticut’s ability to retain and recruit
DEVELOPMENT
companies by taking a highly strategic approach to Manufacturing is an
business development and business engagement. important economic driver
for the state of Connecticut
Originally established in 1993 as the Connecticut Economic
and a key area of focus
Resource Center, Inc., the economic development entity
for the Department of Economic and Community
changed its name to AdvanceCT in 2020.
Development.
Manufacturing has a long history of driving economic
DECD works closely with the sector to address challenges
activity in our state, and AdvanceCT will continue to
and opportunities facing manufacturers of all sizes.
nurture this thriving sector in our transformed efforts.
Over the next 12 months, the chief manufacturing officer
With the support of the Lamont administration, will focus on:
AdvanceCT’s repurposed mission is to spur economic
f Initiating the Connecticut Defense Manufacturing
development in close partnership with the public
Community Consortium focused on the digital
and private sectors.
transformation of the defense supply base and
AdvanceCT has attracted some of Connecticut’s most commencing the Digital Model Initiative which
important business leaders to its board of directors, includes pilot programs for 6 defense suppliers, the
a reflection of the private sector’s sense of urgency development of the playbook with best practices
to address Connecticut’s economic and business and lessons learned, and curriculum and certification
competitiveness. development around Model Based Definition.
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 19f Restarting the Manufacturing Voucher Program To assist in creating partnerships between business/industry
utilizing the $5 million in MAA funds (critical as we and educators that enhance student career preparedness,
look to emerge from COVID-19 and the associated CSDE has partnered with the Connecticut Science Center
recession) and then securing multi-year funding for and ReadyCT to establish a STEM Externship Cohort. This
the Manufacturing Innovation Fund to support cohort provides Connecticut Career and Technical Education
programs around apprenticeship, incumbent worker educators, school counselors, and members of STEM
training, outreach efforts to the K-12 student population, business and industries opportunities to meet, collaborate
and grants for technology adoption, efficiency gains, on instruction, and develop externship experiences.
and capacity expansion.
Per Public Act No. 19-68: An Act Establishing the
f Developing and implementing initiatives around Connecticut Apprenticeship and Education Committee,
emerging technologies including offshore wind power the Manufacturing Committee transitioned and is now
and electric vehicles. the Connecticut Apprenticeship Committee. The law
required the committee to analyze whether current
f Supporting initiatives developed by the Governor’s
apprenticeship training programs available to
Workforce Council, including development of regional
Connecticut residents are meeting workforce needs.
sector partnerships and career pathways and efforts
Also, the committee will expand the Introducing Students
to ensure access for all our residents to workforce
to Manufacturing: Best Practices Guide and Program
opportunities.
Resources to introduce middle school and high school
f Other areas that will receive focus include: Access students, their parents or guardians, guidance counselors
to capital for small manufacturers and select and school counselors to other careers (e.g., insurance,
regulatory reform. healthcare, financial technology, biotechnology, STEM,
Visit ct.gov/decd construction trades, and hospitality industries).
On July 1, 2020, the U.S. Department of Education approved
Connecticut’s Strengthening Career and Technical Education
CONNECTICUT DEPARTMENT
for the 21st Century Act (Perkins V) State Plan. This plan
OF EDUCATION
was created in partnership with the Perkins V leadership
The Connecticut State group and Connecticut stakeholders. The plan ensures
Department of Education the CSDE meets the needs of all learners and includes:
continues to work closely with (1) CSDE goals and levels of performance of CTE activities,
the Office of Apprenticeship (2) evidence-based and innovative strategies and activities to
Training to design rigorous, improve and modernize CTE and align workforce skills with
multiple, and flexible pathways and programs of study labor market needs, and (3) a strategic vision and goals for
to provide students with the skills demanded by industry preparing an educated and skilled Connecticut workforce.
for a high-skill, high-wage, and in-demand career in
Visit ct.gov/sde
manufacturing and STEM fields.
20 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R Ttechnical skills including virtual reality and mechatronics.
CONNECTICUT COLLEGE
OF TECHNOLOGY & In addition, outreach activities for inner city high school
REGIONAL CENTER students will continue to be offered after school and
FOR NEXT GENERATION on Saturdays. In collaboration with industry partners,
MANUFACTURING Industry-driven entrepreneurial projects for current
The Connecticut COT students will be offered as well as internships and
College of apprenticeship experiences.
Technology and its
COT-RCNGM will continue to create and identify virtual
Regional Center for
resources and best practice models that can be used in
Next Generation
engineering and technology programs across the U.S.
Manufacturing address the need for highly skilled
by high school and community college educators and
workers in the advanced manufacturing workplace by
as a result produce technicians and engineers for the
building programs that provide resources to educators
advanced manufacturing workforce.
and students interested in learning new skills and
competencies in advanced manufacturing technology. Finally, COT-RCNGM will continue to partner with industry
and professional associations to produce and disseminate
RCNGM is one of three Centers of Excellence in
outreach materials that market high-tech manufacturing
Manufacturing across the nation funded by the National
careers.
Science Foundation and is administered by Tunxis
Community College in Farmington. COT is a consortium Visit nextgenmfg.org
of all 12 Connecticut public community colleges, 10 public
and private universities, the Connecticut Technical High
School system, as well as comprehensive high schools.
CONNECTICUT DEPARTMENT
OF LABOR
COT’s Site Coordinators Council provides statewide
As demand for highly-skilled
leadership for the implementation of a nationally
workers increase and career
recognized and award winning, stackable credential
exploration cannot occur only
model that provides credit certificates and associate’s
in the schools, it is vital for
degrees that both prepare students for employment as
employers and industry to engage in strengthening the
well as transfer seamlessly to bachelor’s degree programs
connection between educators, students, careers and
in engineering science and technology studies.
the community.
In 2021, COT-RCNGM seeks to provide Connecticut high
This collaboration will ensure students have exposure
school teachers and community college faculty with
to the necessary career ready skills for their chosen
professional development opportunities that include
occupation/career field.
workshops on smart manufacturing and professional and
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 21Business and industry can offer job shadowing, course offerings expanded to include welding, CNC
mentoring, work-based learning and apprenticeship machining and MasterCam, and for the first time were
program opportunities that are crucial to career offered in an online format.
development.
In the 2019-20 academic year, 186 grade 11 and
By accelerating necessary training and cultivating talent, 12 manufacturing students were employed by a
these employer led program designs provide screened, manufacturer participating in Work-Based Learning,
well-prepared workers new to an industry by receiving a program designed for students to gain hands-on
a combination of industry-based formalized training experience and create a skilled-labor pipeline. CTECS
and classroom instruction for potentially acquiring and actively looks to partner with industry and grow this
retaining new employees. number.
Visit ctdol.state.ct.us Working with Connecticut’s community colleges, CTECS
helps facilitate incumbent worker training, and continues
to support the development of articulation agreements
CONNECTICUT TECHNICAL to create manufacturing pathways.
HIGH SCHOOL SYSTEM
Visit cttech.org
The Connecticut Technical
Education and Career System
understands the urgency to CONNECTICUT
build a skilled manufacturing MANUFACTURERS’
workforce, and is committed to supporting the labor COLLABORATIVE
needs of Connecticut employers.
Connecting the
Students in grades 9-12 can choose from five major manufacturing
manufacturing programs: Automated Manufacturing, organizations in
Mechanical Design and Engineering, Mechatronics, Connecticut and the
Precision Machining, and Welding and Metal Fabrication. broader universe of
Additionally, adult learners can participate in full-time manufacturing-focused agencies, institutions, and
manufacturing programs or part-time apprenticeship government officials across the state, the Connecticut
and extension related-instruction courses. Manufacturers’ Collaborative has quickly demonstrated
its value.
This year, CTECS aligned its manufacturing curriculum
to the National Institute for Metalworking Skills skill Established in 2018, the CMC originated and led the effort
standards. Tooling U-SME training was offered and with the Lamont administration and the legislature to
became a virtual learning resource, a necessity during the create the chief manufacturing officer position within the
COVID-19 pandemic. Adult apprenticeship and extension Department of Economic and Community Development.
22 2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R TThat position has already proven to be an invaluable asset As administrators of the CMC, CBIA and its CONNSTEP
for the manufacturing community and policymakers alike. affiliate, provide a wealth of online resources for
manufacturers and worked closely with state and federal
With the onset of COVID-19 in early 2020, the state
emergency management officials on behalf of the CMC
deemed all manufacturing in Connecticut essential,
to facilitate the production and distribution of personal
keeping operations running during the pandemic. The
protective equipment to hospitals, small businesses, and
designation created an immediate and urgent need
nonprofit organizations.
for effective and continuous information flow among
manufacturers, the administration, and the legislature. Looking ahead, the major underlying challenges facing
the sector remain key CMC priorities: an aging workforce,
The CMC initiated video conference calls three times
technology innovation, upskilling incumbent workers,
per week, which provided manufacturers with the
attracting more young people into manufacturing, and
latest on state and federal developments and informed
creating a more comprehensive, vertically coordinated
policymakers about immediate manufacturing
education system to train the manufacturing workforce
challenges and needs, while ensuring there was a regular
of the future.
opportunity to have questions asked and answered.
COMMUNITY CT TECH HS
TECHNOLOGY
SYSTEM
WORKFORCE
COLLEGES
TECHNOLOGY
WORKFORCE
CHAMBERS CT
WORKFORCE
DEVELOPMENT
Eastern Advanced
Manufacturing Association COUNCIL
SDE &
CONVENTIONAL
HIGH SCHOOLS
READYCT
CSCU
DECD / MIF
GENERAL
ASSEMBLY SB&D
MANUFACTORY
4.0 CENTER
Manufacturing Education
UCONN
& Training Alliance CT Tooling &
EDUCATION
TECH PARK
Machining Association
EDUCATION
ECONOMIC
SCHOOL
ECONOMIC
COUNSELOR
GROWTH
GROWTH
ASSOCIATION
OFFICE OF
THE
GOVERNOR
GOODWIN
UNIVERSITY
SCHOOL
SUPER-
INTENDENT
ASSOCIATION AMEP
CCAT RESCs &
COGs
2 0 2 0 C O N N E C T I C U T M A N U FA C T U R I N G R E P O R T 23Manufacturing
IS COOL.
WE’LL SHOW YOU WHY.
readyct.org
#careerconnected #inspired #collegeANDcareer #learning #opportunityHelping Connecticut Manufacturers GROW IMPROVE SUCCEED CONNSTEP understands the challenges manufacturers are facing in today’s unprecedented environment. We take a responsive, professional, and thorough approach to helping your business address issues such as: • Replace lost revenue • Cost reduction strategies • Increase capacity with existing resources • Workforce development • Cybersecurity & CMMC preparation • Implementing technology CONNSTEP. The smart choice for maintaining and building your business with insightful strategies and proven operational methodologies for today’s competitive environment. connstep.org | 800.266.6672
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