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BOOK OF LISTS 2021 | 9 Don Klepper-Smith Chief Economist / Director of Research, DataCore Partners LLC CT economic outlook linked to U.S. performance The National Bureau of Economic Research, the organization that makes the official calls on economic cycles, determined that the U.S. economy formally went into recession in early 2020 after the longest expansion dating back to WWII. Typically, domestic recessions are precipitated by policy errors involving monetary or fiscal policy, but the current recession was brought on by an "exogenous shock," an event outside the realm of our economic system that caused a disruption in output. Real GDP fell at a seasonally adjusted annual rate of 5% in the first quarter of 2020, and then declined 31.7% in the second quarter, the largest quarterly drop since the Great Depression. The economy rebounded in the third quarter. The outlook for recovery and its timing are a function of when an effective vaccine can be made available to the general public and its safety. Consumer fundamentals will be key in determining the path of expansion with recovery likely to commence sometime in 2021. The lack of fiscal discipline at the state and local level continues to be an issue in Connecticut. The state now ranks No. 2 in the country in overall tax burden, according to the Tax Foundation. Given a waning business cycle, high taxes, rising outmigration, and paid family leave initiatives, Connecticut's business community is now facing major challenges in the worst recession dating back to WWII. Farhad Rassekh Economics Professor, University of Hartford 2021 should be a year of recovery With effective vaccines, Connecticut's economy in 2021 should return to its pre-pandemic level. Unfortunately, this is not saying much because our economy has been languishing since the financial crisis of 2008, leading to the stagnation in the housing market — although the housing market recently experienced a revival as many New Yorkers moved to Connecticut. Policymakers should devise credible pro-business policies that will encourage entrepreneurs and families to move into Connecticut, and those already residing in the state to stay; otherwise, our economy will continue to lag behind the majority of states in the country. . ECONOMIST SCORECARDS What's your 2021 economic outlook for CT? What's your 2021 economic outlook for CT? How many jobs will CT add? How many jobs will CT add? What type of GDP growth will CT see in 2021? What type of GDP growth will CT see in 2021? What will CT's unemployment rate be at the end of 2021? What will CT's unemployment rate be at the end of 2021? Which industry will add the most jobs? Which industry will add the most jobs? Which industry will lose the most jobs? Which industry will lose the most jobs? Moderate to Strong growth No growth Any forecast about the labor market hinges on how effectively we control COVID-19. If the recently-developed vaccines prove effective and become widely available, Connecticut should add about 100,000 jobs in 2021 and return to pre-pandemic employment levels. After losing 100,000 jobs on an average annual basis in 2020, the recovery will be muted on the job front with 30,000 to 40,000 new jobs in a technical bounce back. 3% 2% 4% 12% Construction & health care Health care, leisure & hospitality in a bounce back Since almost all sectors of the economy lost jobs during the pandemic — assuming 2021 will be the year of recovery — any job losses in 2021 will likely be minimal. Finance & insurance