Despite Challenges, AdvanceCT’s Denious Forecasts Strong Economic Trends in Right Direction for Connecticut

"Connecticut is a great option for companies and for people. We have to tell that story more aggressively," says AdvanceCT CEO

Yesterday, 45 members of Wilton’s business community attended the 2021 Economic Forecast Meeting, an annual event hosted by the Wilton Chamber of Commerce.

After years of hearing how dismal Connecticut’s economy has been, and how many residents and businesses were leaving the state for other locales, the message was much more optimistic. And for Wilton businesses, including many feeling beleaguered by the long-running pandemic, the presentation brought significantly more welcome news.

The keynote speaker was Peter Denious, CEO of AdvanceCT, a non-profit organization that works in collaboration with the state’s Department of Economic and Community Development and in an advisory capacity to Gov. Ned Lamont to advance economic competitiveness in Connecticut.

Susan Goldman, president of the Chamber’s board of directors, introduced Denious, who is also a Wilton resident, and highlighted his significant business development credentials, which include senior-level positions with private equity and venture capital firms.

Denious shared a presentation that included key data on the Connecticut economy, with a focus on Fairfield county.

Pandemic Recovery and New Investment

“Obviously the pandemic has taken a toll on the Connecticut economy as it has taken a toll on the national economy,” said Denious, but he quickly added, “In many respects, Connecticut fared better than the rest of the country, and particularly Fairfield county fared better” on metrics like unemployment.

Denious sees improvement, though not yet a full economic recovery from the pandemic, and cited one staggering statistic. “We’ve made a lot of progress… in the fourth quarter of 2020 Connecticut grew its economy by 7%. That’s way above the rest of the Northeast. We have a lot of reasons to be optimistic. Our economy is heading in the right direction, the trend line is right. But there is still a lot of work to do.”

That necessary work was outlined in AdvanceCT’s Connecticut’s Action Plan 2020-2025, a comprehensive roadmap for economic development in the state. Denious described the plan as a “massive undertaking,” the result of a joint initiative between AdvanceCT and the governor’s office along with the input of over 70 private sector enterprises as well as outside consulting.

Unfortunately, the action plan was finalized just as the COVID-19 pandemic hit, and was largely tabled with “all hands on deck” for the pandemic response and re-opening efforts. Now that AdvanceCT has begun to shift its attention back to pre-pandemic priorities, the focus is now on the five “pillars” of the action plan, as listed in the chart below.

Denious hinted there may be news forthcoming from the state in several of those key areas. “I think you’ll hear more in the next weeks and months from the governor about strategic investments in these areas” that would help further the recovery from the pandemic “particularly in our most vulnerable communities and our small business community,” Denious said.

He also said he was “optimistic that we’re in a very good position to make those investments.”

While he conceded the state’s financial health has been a “decades-long problem,” he credited the 2017 state legislative action that forces capital gains the state achieves to be set aside in a “rainy day fund”.

Denious said, with emphasis, “Connecticut is actually going to run a surplus this year. That is remarkable. We have a $3.8 billion rainy day fund, which New Jersey and New York [don’t have], which is why both those states are raising taxes, and so far Gov. Lamont has said he’s going to hold the line on raising taxes in our state.”

Workforce Development

It does not seem accidental that “workforce” appeared at the top of the list of the five pillars in AdvanceCT’s plan.

Denious believes the positive attributes of Connecticut’s highly educated and skilled workforce have been and will continue to be critical for the state’s attractiveness to employers.

Denious noted that financial services (including insurance) represent the lion’s share of Connecticut businesses, with 27,000 jobs. However, he is particularly excited about the growth in the field of bioscience, where the number of jobs is projected to grow more than 20% by 2024. Denious called it “a major area for growth and a huge area of focus on our part at AdvanceCT.”

“We’re very engaged in trying to help businesses take advantage of what the state is rolling out in terms of workforce development. This is a huge priority, it’s well placed, it’s very well thought out,” said Denious.

Denious’ prediction about potential investment came true just hours later, as the governor’s office issued a press release on a proposal to invest $103 million from the American Rescue Plan Act in training programs aimed at workers whose employment has been impacted by the pandemic.

Most of the money would be spent to “reskill and upskill” some 9,000 displaced workers through training programs in high-demand sectors. The press release cited the fact that last month (March 2021) had the state’s highest monthly job openings in the past 10 years.

“Investing in our workers is a win-win,” Lamont said in the press release. “This is a once in a lifetime opportunity to shape the future of Connecticut’s workforce and ensure it aligns with the needs of the post-pandemic, 21st-century economy.”

While the governor’s new proposal targets displaced workers, college students are also seen as important for the future of the workforce. Denious said significant efforts are underway to help retain college students as residents and workers after they graduate. “Connecticut ranks 37th in retaining college students,” Denious pointed out, calling it a “missed opportunity” to keep talent in the state.

He mentioned a pilot program coming soon called “Campus Connecticut,” modeled after a successful program in Philadelphia where similar problems existed with college students leaving the area.

Denious said the program will create a virtual community where, among other things, students and employers can meet. The goal is to improve the retention rate by five percentage points in the next three years.

More Influx Than Exodus

At the moment, “all the talk about people leaving the state” is being drowned out by the huge influx of residents and businesses to Connecticut.

On the business side, Denious shared examples of several companies that have recently expanded, relocated or established new headquarters in our area.

While only one example, ASML, was a Wilton company, Denious made repeated comments during the meeting on the need to view economic development in a more regional context, and not as “a zero-sum game” vis-a-vis surrounding towns.

“If Westport or New Canaan gets a new business, that’s still good for Wilton,” said Denious. “Obviously it would be great if it came to Wilton, but there are all kinds of effects from a business locating one town over,” he said.

Denious also pointed to numerous residential real estate metrics all headed in the upward direction–including new listings, number of sold listings and sale prices. “The only thing that’s down is days on market,” he said, highlighting how that’s actually a good indicator.

When it comes to moving commercial property, Denious says tools like Sitefinder can be utilized very effectively. Sitefinder is a real-estate location tool on AdvanceCT’s website, and described as “Connecticut’s most comprehensive online database of available commercial properties. Brokers, economic developers and end-users can post and search for retail, office, industrial, investment, and specialty real estate online. For more than a decade, SiteFinder has been a key tool among hundreds of daily users in the transaction process, resulting in successful deals helping to grow businesses and jobs in Connecticut.”

Still, to get its fair share of new businesses and residents, Denious says Wilton needs to “have a pitch, have a story, have marketing materials” ready.

That positive story exists at the state level, too, says Denious, who cited the state’s strong performance on COVID vaccine rates and impressive statistics on Connecticut public schools, quality of life, and other important measures (even some cost of living measures). All of that shows “just how much Connecticut punches above its weight,” as Denious put it.

“This is why Connecticut is a great option for companies and for people. We have to get out and tell that story more aggressively,” he said.

Wilton EDC’s Role

AdvanceCT believes Wilton’s Economic Development Commission (EDC) can play a key role in “telling the story” about Wilton and making the marketing pitch to prospective businesses.

Earlier in the pandemic, AdvanceCT made recommendations to help the commission respond to the challenging business climate created by the pandemic, including the idea of preparing “a data package to promote business recruitment” and updating existing resources, namely the EDC website (which is separate from the EDC page on the town website) and the EDC’s “It’s Working in Wilton” video, with emphasis on “information relevant to business decision-makers, developers, and commercial realtors.”

The most recent Wednesday, April 21 EDC meeting included a discussion of how the commission will be addressing AdvanceCT’s recommended action steps going forward.

Aren’t Taxes The Real Problem in CT?

During the Q&A portion of the meeting, one attendee asked, “Isn’t it safe to say the tax rates are a much bigger issue in bringing businesses to CT than housing prices?”

Denious agreed that high taxes are a hurdle, but are not always the most important factor for companies deciding where to locate. He explained:

“Taxes are definitely an issue. We don’t pretend to be a low-cost state. From a business recruitment [standpoint], we’re not trying to pretend to be something that we’re not. We’re not spending time trying to convince the governor to lower taxes. We’ve been dealt a hand, and we’re trying to make the best of it. Our taxes are high [but] they’re not, frankly, that much higher than some of our regional peers. When you factor in property taxes, CT actually compares favorably [in some cases]. I’m careful about making regional comparisons because it’s not a strong hand for us. I think there are a lot of factors that offset [high taxes], and/or that are other considerations for companies – particularly talent. If a company wants the lowest cost, we’re just not going to win. But if they want the best people, if they want to put a business here that requires a level of expertise, we’ve got the people to staff that company.”

He also clarified that AdvanceCT is not a lobbying organization, and does not take positions on political issues. He encouraged businesses to share their opinions on taxes and other business matters with the Connecticut Business and Industry Association (CBIA), the state’s largest business advocacy group that relays the views of businesses to the governor in a well-organized, official capacity.

Bottom Line?

“There’s a lot of good things going on, but there’s a lot of tough work to do as we look at the future,” said Denious in his closing comments.

“I encourage anyone who wants to get involved, to get involved. This is Connecticut’s opportunity to lock arms and improve our state,” he added.

To become a member of AdvanceCT, contact the organization by email or on its website.

The entire recorded Zoom meeting/presentation is available on the Chamber website.