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July 7, 2020

Feds: CT’s 1Q economy declined 4.6%, bests other Northeast states

Images | U.S. Bureau of Economic Analysis Gross Domestic Product by State, 1st Quarter 2020
By Joe Cooper

Connecticut’s $288 billion economy shrunk 4.6% in the first quarter of 2020, putting it on pace with the national average and ahead of other Northeast states as the country deals with the economic fallout of the coronavirus pandemic, new data shows.

The state’s Gross domestic product (GDP), or the market value of goods and services produced by labor and properties, adjusted for inflation, fell 4.6% from Jan. 1 to March 31, according to the U.S. Bureau of Economic Analysis (BEA). 

Economies in all 50 U.S. states and Washington, D.C. shrunk between a range of 1.3% (Nebraska) and 8.2% (New York and Nevada). Connecticut’s GDP rate ranked as the 18th best nationally, and ahead of 10 other states listed in the New England (average 5.2% decline) and Mideast (6.6% decline) regions.

The BEA in Tuesday's report said the nationwide economic declines in GDP were a result of COVID-19-related shutdowns as governments issued stay-at-home orders.

"This led to rapid changes in demand, as businesses and schools switched to remote work or canceled operations, and consumers canceled, restricted, or redirected their spending," the agency said.

The largest industry declines in Connecticut’s GDP included the health care and social assistance (-0.77%), accommodation and food services (-0.73%), and the finance and insurance (-0.71%) sectors. Other industries in decline included real estate and rental and leasing (-0.45%), government (-0.40%) and arts, entertainment and recreation (-0.39%).

Sectors recording minimal gains in GDP were nondurable goods manufacturing (0.26%), construction (0.16%) and management of companies and enterprises (0.15%).

Connecticut’s decline in GDP comes after the state recorded growth in each quarter in 2019 ranging from 0.9% to 4.3%.

View BEA’s latest GDP report here

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