Today, the Connecticut Business and Industry Association (CBIA) released its 2025 Survey of Connecticut Businesses. At today’s CBIA’s Connecticut Economy Conference, CBIA President and CEO Chris DiPentima said that this year’s survey showed “some signs of optimism,” but also “concerns about the state’s competitiveness.”
“At the risk of stating the obvious, these are interesting and challenging times,” said Chris DiPentima, CBIA President and CEO. “More than anything, business leaders and I firmly believe our residents want predictability, stability and certainty and both [sic] are in a little bit of a short supply these days.”
DiPentima said that the CBIA surveyed the owners of over 3,000 businesses this summer, “to assess current challenges and opportunities, better understand their outlook and expectations for the future and effectively inform our policy advocacy.” When asked what the biggest obstacles to business growth were, owners cited the state’s lack of skilled applicants (27%), uncertainty of state and federal policies (14%), high business taxes (11%) and increased regulatory costs (11%) as their primary concerns. An overwhelming 91% of respondents noted their belief that the cost of doing business is rising due to higher labor, healthcare, energy, and compliance costs.
DiPentima said there is “no more critical issue than the labor shortage, identified in our survey again as the main obstacle to growth.” Per the survey, while the state has the 14th-best labor participation rate in the country, there still remain 77,000 job openings as of July 2025. Citing the U.S. Bureau of Labor Statistics, the survey indicated that Connecticut was middle of the pack among New England states’ post-COVID job recovery rates, recovering 107% of jobs lost in the early months of the pandemic, and was far below the national recovery rate of 133%.
27% of survey respondents listed a “lack of skilled applicants” as the most significant obstacle for their business. 39% of respondents said it was difficult to find workers, but had no issues retaining them, 35% said it was difficult for them to both find and retain workers, and only 34% reported having difficulty with neither. The largest reason cited by respondents with employment challenges was a lack of skills and expertise amongst applicants (40%), followed by concerns with employee work ethic (26%), an inability to pay employees’ their desired wages (18%) and the state’s high cost of living (9%).
“Obviously, the job market is the driving force behind Connecticut’s economy, with more employment leading to higher GDP, more tax revenue,” said DiPentima. “Policy makers must support solutions that make Connecticut more affordable for residents and businesses, so that we can grow the labor force.”
The second largest concern cited by business owners in the survey was uncertainty among business owners due to decisions made by the state and federal government. On the state level, DiPentima cited the “weakening” of the state’s fiscal guardrails as a concern, as well as what the CBIA estimates will be a $350 million tax hike on businesses and an additional $2.6 billion in state expenditures over the next two years. Survey respondents held a mixed to negative view of the legislature’s role in promoting job and economic growth; 37% held a neutral view, 17% either somewhat or strongly approved, and 46% somewhat or strongly disapproved.
“This year’s survey shows growing concerns over unnecessary uncertainty generated by both federal and state policy decisions, particularly tariffs and the pivot by Connecticut policymakers away from the fiscal guardrails and no-tax policies that brought much-needed economic stability in recent years,” wrote DiPentima in the survey.
While Lamont has advocated for maintaining the guardrails, he showed increased flexibility in this year’s state budget as a result of the budget’s high fixed costs, the expiration of COVID-era federal funding, and the uncertainty surrounding federal funding at large as a result of the Trump administration. DiPentima himself noted the Trump administration as a contributing factor for business owners’ feelings of economic uncertainty.
“Connecticut’s fiscal and economic challenges are compounded by ongoing instability and unpredictability at the federal level,” said DiPentima. “Employers are closely monitoring federal fiscal policy, trade dynamics and inflationary pressures, all of which have a direct implication for businesses’ cost planning and competitiveness.”
In the survey, 64% of business owners reported they expect tariffs to negatively impact their businesses, with only 2% and 16% reporting tariffs to have positive to no impacts, respectively. When asked how the One Big Beautiful Bill will impact their businesses, 41% of owners said they were unsure, 33% said negatively, 15% said it will have no impact and only 11% said it would affect them positively. 38% were uncertain how federal funding cuts would impact their business, 28% expected them to have a negative effect, 26% expected no impact and only 9% expected they would have a positive one.
“The radical shifts that can come at any time are highly challenging and we have moved to be very dynamic to try to survive, then thrive,” said one survey respondent.
Uncertainty seemed to be the recurring theme of this year’s survey; 48% of respondents expect the state’s economy to remain static over the next year, 23% expect it will contract and another 23% expect it to moderately grow. 0% of respondents expected strong growth in the state’s economy.
Looking ahead, business owners recommended the state legislature continue to address many of the same issues identified in last year’s survey, chief among them being affordability. 20% of respondents thought lowering healthcare costs and increasing its accessibility should be the legislature’s top goal, 18% said it should be lowering the cost of energy, and 13% said it should be implementing state spending reforms.
The CBIA also cited its own research to highlight the importance of increasing access to affordable housing. Researchers at the CBIA’s Foundation for Economic Growth & Opportunity released a report in May, which estimated the state to be 100,000 to 150,000 units short on affordable housing. The report also determined the housing shortage to be a critical mitigator to state job growth.
“The economic costs of Connecticut’s housing shortage manifest across multiple dimensions: reduced workforce availability as potential employees are priced out of job centers; increased business operating costs; suppressed consumer spending as housing costs consume larger portions of household budgets; and diminished economic mobility that threatens future growth,” said the report.
While the prevailing sentiments of DiPentima and CBIA’s survey respondents surrounding the state’s economic outlook remained uncertain at best and negative at worst, the survey did show signs of economic resilience. 60% of respondents expected their businesses to profit by the year’s end, another 21% expect to break even, and only 12% are expecting losses. 36% report an increase in sales, 40% said they’re holding steady, and 18% said they’re seeing reductions.
DiPentima also highlighted examples signs of increased cooperation between business owners and lawmakers, pointing to this year’s reworking of the Transfer Act as “truly, truly transformation policy,” and saying there’s been “progress” in private and public cooperation on childcare affordability, which DiPentima said was “one of the factors that’s clearly suppressing labor force participation.”
“Good things happen when the government and the private sector work together,” said DiPentima. “The opportunities to work together and address our most complex challenges are no doubt, limitless. It takes commitment and willingness, not only from policy makers, but from you all as business leaders, to raise your hand, engage, and share your solution for unlocking our state’s incredible, incredible economic potential.”
Was this article helpful?
Republish our articles for free, online or in print, under a Creative Commons license.
