Money Maker
This means Connecticut is gaining employment market share in the securities industry compared with other states, even with average industry annual wage levels that are almost twice the national average ($310,734 to $166,950 in 2005) and highest in the country by far. This supreme pay comes from worksites in the State, not from residents commuting to New York. As a matter of fact, the 20,000 or so securities jobs located here pay better than the average securities jobs located in New York ($295,106 in the city; $274,322 statewide). Avoiding herding behavior associated with financial manias makes a difference, so some removal from Wall Street lets independent thinking and contrarian investing flourish for Connecticut's investment sector.
Connecticut was also one of the few states in the Northeast to add jobs since 2001 in this sector (+2,577). New Jersey still lost jobs (-2,230) over this period, but actually increased that state's concentration of securities industry employment (its location quotient went from 2.134 to 2.155), reflecting some of the dispersion from the devastating effects of 9-11 on Wall Street combined with a slower loss than the nation. Decentralization of the financial industry has spawned more financial innovation for Connecticut. The expertise in Connecticut is delivering outperforming risk-adjusted returns on investment to produce those high average incomes and straight-up job gains.
Alchemy Coast
Connecticut's proximity to the world's financial hub makes this key job growth in the State by and large a Fairfield County story so far. Since June 2000, Fairfield County has increased its proportion of investment employment in the State from 70% to over 80% now, or 16,800 jobs. This was a job growth rate of 7.9% a year in a time span that included an employment recession. The county had over 15,300 investment jobs in 2005 that paid an unbelievable average $357,757 per job. Greenwich and Stamford anchor the investment growth spreading in the gold coast. The State's other counties have much less investment employment and could benefit from increases in this sector. New Haven County's (1,001 jobs) contribution to investment job growth in the State has some relation to Yale University's very successful endowment performance, which is among the leaders in accumulated capital, risk-adjusted rate of return, and successful forays into new asset classes. This endowment supports Yale's future growth while the university supports Connecticut's investment forte (Behavioral Finance). Hartford County's (2,003 jobs) investment job levels are maintained by the insurance industry's need for and placement of more specialized investment products, as well as individual investment activities of the aging population. Acquired wealth needs purchasing power protection.
One could picture a global (Asian) investment bank, on a small scale, setting up in New London County, near the Thames River, taking advantage of the growing Asian populations and interest near the Indian reservations and reflecting past Asian financing forays into Indian casino development. This would particularly impersonate London, England's strong and growing global investment presence on the Thames River near Canary Wharf and the Square Mile. It would also diversify the State's portfolio of global investment firms like UBS (Swiss, Stamford), ING (Dutch, Windsor), and RBS (Scottish, Greenwich), with an Asian presence and help the southeast diversify into a high-value investment employment segment of which it has only a limited count so far (less than 1% percent of State investment jobs or 140 jobs in September 2006). Or maybe some hedge fund/private equity/venture capital incidence inaugurated in New London County would suffice as this industry segment is often considered one of the most "entrepreneurial" in any economy, helping in the evolution and reallocation of capital from an industrial society to a knowledge-based society.