Category

Strengths (Internal Positive)

Weaknesses (Internal Negative)

Opportunities (External Positive)

Threats (External Negative)

Ease of Doing Business

1. Strong Economic Growth: Ranked in the Top 10 nationally for real GDP growth (4.6% in Spring 2025), showing resilience and an ability to adapt to a challenging national environment.

1. High Costs/Poor Startup Climate: Ranked as the second worst state to start a business in 2025 due to high labor and energy costs, and office space affordability.

1. Economic Development Investment: State's willingness to "step up" with investments in innovation accelerators and job training to counter national uncertainty.

1. High Tax/Cost of Living Burden: Continual high cost of living and unfavorable tax policies that drive both businesses and a highly educated workforce out of the state.

Domestic Manufacturing

1. High-Value/High-Skill: Specializes in advanced, high-value, low-volume manufacturing (e.g., aerospace, defense, medical equipment), with workers producing $266,400 per worker (5th highest nationally).

1. Critical Workforce Shortage: 82% of manufacturers report difficulty finding and retaining a skilled workforce, which directly limits sector growth and full employment.

1. Defense Contract Pipeline: Significant and stable defense contract spending ($26.6 billion in 2024), providing a consistent revenue stream and growth foundation.

1. Federal Trade/Tariff Volatility: Growing uncertainty surrounding federal tariff and trade policies, which creates instability for manufacturers heavily reliant on exports and global supply chains.

Sustainability Initiatives

1. Ambitious Climate Goals: Statutory goals include a 45% GHG reduction by 2030 and a zero-carbon energy supply by 2040, providing a clear long-term roadmap.

1. Lack of Integration with Trade: While policies are strong, directly linking these initiatives to a global competitive trade advantage for all businesses is an ongoing process.

1. GreenGain Program: New pilot program for small manufacturers offering training and funding for decarbonization, ESG reporting, and energy efficiency to boost global competitiveness.

1. Compliance Costs: The initial cost of compliance for small and medium-sized enterprises (SMEs) to meet new energy efficiency and ESG standards may temporarily reduce their competitiveness.

Balance of Trade

1. Significant Export Base: Exported $17.4 billion in goods in 2024 (28th largest state exporter), with key markets in Canada, Germany, and Mexico.

1. Heavy Import Reliance: As a service- and high-tech manufacturing economy, the state is reliant on imports for raw materials and consumer goods, resulting in a likely overall trade deficit.

1. Foreign Direct Investment (FDI): Foreign-controlled companies employ 113,200 Connecticut workers, indicating the state's attractiveness as a location for international companies to enter the US market.

1. Global Economic Slowdown: A potential global economic slowdown or further escalation of international trade disputes could disproportionately impact the state's high-value exports (e.g., jet engines, machinery).