Welcome to February, Pulse readers!

Connecticut continues to see a surplus as we head into the 2026 legislative session. We’ll be keeping an eye on legislation that affects the bottom dollar in budgets, from the state to your business to your pockets.

This month, the Economic Update takes a closer look at different policies, trends and events that will have the biggest impact on the economy this year. It also covers three months of Connecticut jobs data, all released in January, that shows which industries are growing and which ones are not.

Also, if you’re free next Monday, I’d like to invite you to the Comptroller’s Healthcare Cabinet’s annual report unveiling at the Capitol. RSVP at bit.ly/compcab.

Thanks for giving this a read, and be sure to let me know if there’s any topics you’d like to see covered more in-depth.

Stay sharp, stay informed, and keep your finger on the pulse,

Comptroller Sean Scanlon

Quick Beat

General Fund Surplus:

$85.9 million

Special Transportation Fund Surplus:

$46.5 million

Connecticut’s economy grew 5.6% (SAAR) in Q3 2025, adjusting for inflation, the 4th fastest among states. Strong growth in durable goods manufacturing and key white-collar industries, as well as improvement in the retail sector, drove faster growth for the quarter.

Lower global oil prices are providing some relief this winter, but frigid temperatures are driving utility bills higher. Regular unleaded gasoline averaged $2.85 per gallon in Connecticut the week of 1/23/26, down from $3.09 the same week in 2025.

2025 was another sluggish year for home sales. Falling mortgage rates could support more inventory and sales in 2026. Multifamily housing is likely to dominate new home construction based on building permit activity.

Employers added just 900 jobs in Q4, and payrolls shrank by 2,200 positions year-over-year through December. There were 74,000 open positions as of November.
KEY DATES THIS MONTH

 

2/4 – Governor releases proposed state budget revisions for next year

2/4 – Start of CT legislative session

 

2/6 – January U.S. jobs report

2/11 – January CPI inflation report

2/20 – U.S. GDP Q4 2025 first estimate

 

TBD – January CT jobs report
Will the AI boom continue to push stocks higher in 2026 or will the bubble burst? That’s a key question for Connecticut. A major drop in U.S. equity values could reverberate throughout the economy if households pull back on spending when their investments decline. Alternatively, it could tamp down business investment.
Read more
The major tax and spending law passed by Congress last summer, known as the One Big Beautiful Bill Act (“OBBBA”), is expected to stimulate economic activity in 2026, while also reducing safety net benefits for low-income residents and hurting specific industries, like solar energy, electric vehicles, and higher education.
What else is impacted?
While everyday consumers are feeling the stresses of inflation, well-off households are more likely to be benefitting from the strong stock market, with the “wealth effect” making them more willing to spend.
What’s driving it?
Connecticut’s unemployment rate rose to 4.2% in December, up from 3.8% in September and 4.0% in November. The labor market has been gradually cooling but further deterioration would mean trouble.
Read more
The Office of the State Comptroller | 165 Capitol Ave | Hartford, CT 06106 US