HARTFORD, Conn. (AP) -- Connecticut's Department of Labor said Thursday the unemployment rate fell to 8.6 percent in December, down from 8.9 percent in November. Typically, that's a good sign, but labor economists say the drop is due to a declining labor force.
A persistent problem is that Connecticut's demographics are changing as workers drop out of the labor force, retiring prematurely or giving up job-hunting in frustration, said Andy Condon, the labor agency's research director.
The labor agency reported that 1,800 private sector jobs were lost for the sixth straight month in December.
"The state's trend of a declining labor force continues for the sixth month in a row and was the primary factor behind the declining unemployment rate in December," Condon said.
The state expects the number of jobs in Connecticut to be revised upward by as much as 10,000 when revisions are completed in March, he said. But it's still not clear that Connecticut is creating more jobs or if the revised numbers were not captured by statisticians, Condon said.
Even a spurt in employment before the busy Christmas shopping season disappeared as labor economists revised the number of retail jobs. Retail employment fell by 1,600, or nearly 1 percent, in December, which state officials called a "lackluster showing in the midst of a rapidly declining labor force."
For 2012, 2,800 private sector jobs were created, up just 0.2 percent
Economist Peter Gioia of the Connecticut Business & Industry Association, said the jobs numbers are "pretty grim news."
"Overall it shows an economy that isn't even in first gear right now," he said. "It's really stuck in neutral."
Connecticut has recovered 28,700, of the jobs it lost in the recession from March 2008 to February 2010, which Condon characterized as slow. It represents about a quarter of the 117,500 total nonfarm jobs that disappeared.
In the nearly three years since the start of the economic recovery, four major industry sectors — government, financial activities, manufacturing and construction and mining — have lost jobs, the Labor Department said.
The leisure and hospitality industry regained more jobs than it lost and education and health services did not lose jobs during the recession and gained 25,000 jobs since the start of the recovery in February 2010.
Connecticut reached its high point in the job recovery in February 2012 when 1.6 million jobs were posted.