CT Should Prepare to Replace It's Growing, Aging Workforce, Report Says

During the past decade, the median age of employees in Connecticut increased to 40.9, the 6th highest in the country.  Connecticut is getting older, and still working.

The data, outlined in the latest issue of the Connecticut Economic Digest produced by the State Department of Labor, suggests some challenges ahead, and opportunities.  All industries are affected by population changes, the report points out, “but some are facing particular challenges as a larger proportion of the workforce is nearing retirement age.”

In 1998, 13% of the state's labor force was under the age of 25, 74% were aged 25-54—considered the prime age for working—and just 14% were over 54. By 2018, 11% of the state's workforce was under 25, 62% were aged between 25 and 54, and 27% were over 54.

“The portion of the workforce in prime age is down 12 percentage points over 20 years while the portion over 54 has almost doubled,” the report notes, highlighting the rapidly increasing portion of the workforce.

“Connecticut has a highly skilled and experienced workforce, 42% percent of which have at least a college degree compared to 37% nationally. However, the increasing portion of older workers also indicates that a large share of the workforce is approaching retirement age, heightening the need for replacement workers in coming decades.”

While most sectors experienced declines in the share of under 25 and prime age employment over the past 10 years, every sector had share increases of its over 54 workforce, the report points out.  Finance and insurance (70%), professional, scientific, and technical services (69%), and information (68%) have the highest concentrations of workers aged between 25 and 54.

In highlighting the report, the Connecticut Business & Industry Association (CBIA) recalled that in his keynote speech this spring at CBIA's Connecticut Economic Update, Pratt & Whitney CEO Bob Leduc said a lack of skilled workers "is the one thing that keeps me up at night."  Between retirements and growth, Pratt will need 8,000 new hires in Connecticut in the next 10 years, 30% of them in manufacturing, Leduc said.  Those comments came prior to the announcement of the UTC-Raytheon merger, but the projections have not changed.

The report urges stepped up workforce development efforts, particularly in sectors hit hardest by the growth in workers aged over 54. Manufacturing, Utilities, and Public Administration have the largest shares of workers over 54, the report indicates, while Accommodations & Food Services, Retail Trade, and Arts, Entertainment & Recreation have the smallest.

"As this age cohort grows in Connecticut, knowing which industries have a large share of these highly experienced workers is important to ensure that their needs are met and that an adequate pipeline exists to help train incoming workers to replace those who will eventually retire," the economic analysis points out.   

The report also points out that “manufacturing employment has been growing steadily since hitting a low at the end of 2016, a notable trend shift for the industry. The decrease in prime age manufacturing employment has occurred as the over 54 employment increased by 11,000 as many manufacturing workers aged into this cohort.”

In addition, “Healthcare and Social assistance is the largest sector in the state overall, and employs the most workers over 54, with over 71,000. This sector has had the largest total increase of over 54 workers, up 20,000 since 2008.”

The report’s bottom line: the state needs to assure that “adequate pipeline exists to help train incoming workers to replace those who will eventually retire.”