February 2012

Connecticut's Changing Demographics Foreshadow Declining Workforce Income

Orlando J. Rodriguez, M.A.

This report finds that closing Connecticut's opportunity gaps will be necessary for the future economic health and quality of life in the state as a whole. Among the findings:

  • A growing number of retirees and an increase in lower-paid minority populations mean that Connecticut is losing higher-income workers (older, more educated whites) while adding lower-income workers (younger, less educated minorities). This convergence of demographic trends will hamper the state's economic growth and its ability to pay for the growing costs of an aging population.
  • If racial and ethnic income gaps continue to grow at recent rates, the average per capita income for Connecticut's working age population will decline by 8.6% between 2010 and 2030.
  • However, if racial income gaps are closed by 2015 and incomes for all workers are raised to the same level as white workers, then per capita income for the working-age population will increase by 12% between 2010 and 2030.

To help in raising incomes of lower-wage workers, we recommend investments in education and training; attracting new businesses and out-of state workers; and offsetting declines in state revenue through progressive income and estate tax reforms.

Issue Area:
Family Economic Security