Constitution State News

NFIB has urged Connecticut lawmakers to use federal funds to replenish the Unemployment Insurance trust fund, which is facing a crisis. Without intervention, small business owners will face significant tax increases on top of challenges from the COVID-19 pandemic.

Connecticut borrowed $888 million from the federal government to cover unemployment claims driven by the pandemic. While $425 million in repayments have been made, employers are still responsible for $463 million, leading to four years of tax hikes starting this fall.

Wendy Traub, owner of Hemlock Directional Boring in Torrington and NFIB State Director Andy Markowski addressed the issue at the state Capitol.

“The pandemic government-mandated shutdowns left thousands of small businesses in despair. Unfortunately, many were forced to close permanently, meanwhile, the rest of us are still trying to recover from loss of revenue and manpower that was the result of forces outside our control," said Traub. She added that uncertainty about potential future restrictions or taxes limits investment in workforce growth and equipment.

Traub emphasized that using federal relief funds for Connecticut’s Unemployment Fund is necessary due to shutdowns imposed by the state during COVID-19. “Transferring the financial obligations of the repayment of the state’s Unemployment Fund debt to small business owners is incomprehensible," she stated.

Despite being in business for over 25 years, Traub's company faced severe setbacks when COVID restrictions hit. The company's work was halted or canceled, resulting in minimal revenue for much of 2020. Even two years later, challenges like hiring workers and inflation persist.

Andrew Markowski acknowledged recent legislative efforts but stressed that small businesses remain concerned about rising costs. “Here’s what we know: our small business owners are bearing the brunt of the unemployment insurance crisis," he said.

The NFIB monthly jobs report indicates that 22% of owners cite labor quality as their top problem, following inflation concerns. Additionally, 26% consider inflation as their main operational challenge according to NFIB's Small Business Optimism Index—the highest since 1981.