Bombshell! Connecticut not business friendly
He! I think I could have told them this. Think I have. But coming from the state’s largest private employer it does have impact.
The Courant covered the United Technologies analysts meeting in New York yesterday and nothing here surprises me.
Connecticut’s biggest private employer is determined to do more of its work outside its home state and other “high-cost” locations, top executives said Friday at an investors’ conference in New York.
“Anyplace outside of Connecticut is low-cost,” United Technologies Corp.‘s chief financial officer, Gregory Hayes, told Wall Street investment analysts — paraphrasing previous remarks by another UTC executive, Jeff Pino, president of Sikorsky Aircraft.
“Even if work has to stay in the U.S., there are opportunities to reduce cost by moving out of those high-cost locations,” Hayes said.
Make no mistake this is a warning shot across Connecticut’s bow but it also sends a signal to other high cost states. I’ll admit there might be some posturing here but not a lot. I have covered these meetings as a business reporter, many, many times. What a CEO or CFO says in these meetings carries a lot of weight and securities laws leave little wiggle room. Analysts make recommendations and investors make choices based in part on what’s said. Words are chosen carefully and nothing is said that has not been carefully vetted. So you can bet UTC is letting the investment community know Connecticut laws, regulations, and costs are killing em and something has to be done.
But this is the line I would find most disturbing if I were a state official.
Chênevert suggested that UTC would not bear sole responsibility for making Connecticut a place where it would continue to operate.
“I think it’s a known fact … that Connecticut ranks almost dead last in competitiveness for manufacturing,” he said. “And at some point, whatever the state can do to be helpful, maybe work with large companies like ours, is going to ensure that you have the optimal outcome for Connecticut.”
Allow me to translate. Hey Connecticut … look in the mirror. My thoughts: quick fixes in the form of special, one time tax breaks for manufacturing won’t do anymore. The state needs to reexamine its tax structure, and mandates for all corporations in the state. And stop looking at them like an “all you can eat buffet” every time the overspending irresponsible legislature needs cash.
Jim, this does not SURPRISE me at all. Connecticut, sadly has become not only an EXPENSIVE state to live, but to do business as well. Time for this state to clean both the state house and senate.
Gee, a large part of that expense couldn't be due to senatorial candidate and attorney general Blumenthal's penchant for suing a company if they so much as sneeze in this state! Sued if you stay, sued if you leave (or try to). The only sane course of action is to never come to this state.
I hope that Blumie's competitors bring that up each and every chance they get. By the way, when is he going to get that Prius to commute from his mansion in Fairfield. They will be real cheap now, and get to Hartford really quickly!
Can we get specific? What are the high costs? Don't blame just the unions, thats too simplistic, because for every union benefit paid, the white collar postitions get the same thing – if not more. And at the negotiation table there are two sides – do you blame the union for doing their jobs, trying to get the best deal for employee members, or the management at UTC, paid to negotiate for the company?
Electricity? Isn't that another private company these days just trying to please stock holders and make a profit too? Insurance? same thing. What exactly are these costs that the state and towns have to fix?
If its taxes – we tried that with Pratt did we not? But if lowering the corporate taxes will help, then lets explore that. Regulation? What is being regulated and why? Surely, if the state can assist in areas it has control over, and maybe put more of an emphasis on manufacturing skills in trade schools instead of liberal arts colleges for future employees, then the folks at UTC would be all about hiring locally would they not?
Or are these not the real reasons they want to leave CT? I grew up with UTC companies – my parents – relatives – and neighbors all worked in them – it would be a shame that its CT's fault that they want to leave. So hopefully our representatives can meet with them and get at the truth of this and see what we all can work out.
We can sit here all polarized – the business first crowd and the labor crowd and go nowhere fast. The reality is UTC wants to be global yet they need US government contracts and those contracts might just as well go to another company if they want to play the offshore game that badly. CT is an expensive place to live – I've lived here all my life, but I choose to because we have the best healthcare, police, fire & ems, etc etc – which is why UTC and many other corporate headquarters want to stay here. Ive been down south and it doesn't compare in many places where its cheap to live – theres a reason for things being cheap. Same with offshore.
Lastly – regarding government contracts – they should all be placed with US companies without debate. US taxpayers fund these purchases and trying to get in good with NATO or the UN or whatever doesn't put food on our tables – but supporting our own CT and US industries does, like Colt, Sikorsky, P&W, GE, etc etc. But these companies should also reciprocate by hiring the best – us.
The tax rate in CT is one of the highest in the US. CT is not a "Right to Work" state either. This forces you to join a union and pay union dues, even if you do not want to join a union. All the other high fees (gasoline taxes,car registration, sales tax, very high property tax, car insurance rates, etc.) drives up the cost of living.
Higher taxes and cost require workers to make more to have a decent standard of living. By simply moving to a lower tax state, you can afford to make less money and have a equal or higher standard of living.
Leave CT and your $6,000 property tax goes to less than $2,000. Leave CT and all of your cost get lower. Your standard of living goes up and your cost go down.
Instead of lowering the cost of living, states end up giving large employers massive tax breaks to stay or move. This is a ploy used by large corporations to get states to bid on them staying or moving by using tax breaks. CT will fall into this, they have done it before. Small business and individuals will pay for these tax breaks to large corporations. So this is just the beginning of the bidding war for UTC.
Regardless of the outcome, we, the people, loose. We either loose jobs or see our cost of living go up to pay for the tax "incentives" used to keep UTC from leaving.
It's amazing, we never get any tax incentives to stay in CT. We just get to pay.
I just wish I could move out of state sooner than I have planned. Like many, I can't afford to stay in CT. I'll be leaving as soon as I can. Just one more son to get out of high school and I'm gone