HARTFORD -- It is lunchtime at Frank's, one of this city's more popular downtown restaurants. As always, business executives in stolid gray suits have filled the room.
The tables are close together and to the casual eavesdropper the conversations seem almost like one communal dialogue.
"I heard Aetna was going to lay more people off," said one man to another, over soup. "I also heard that the Civic Center was in trouble."
At the next table the talk was of real estate.
"That house has fallen at least $100,000 in the last year," said one man as three colleagues all gave quick, knowing nods of confirmation. "How much more can it drop?"
That has become the basic question of life in Hartford these days: How much more can it drop? Stung by the abrupt end of one of the nation's most robust commercial real estate booms, by the recent departure of Sage Allen, one of the city's two downtown department stores, and by the disappearance of two major hotels in the past year, area residents are wondering whether their recession will ever end.
The pain has been increased by the speed and ferocity with which the recession attacked the New England region and by an even larger curse, Connecticut's remarkably high expectations for economic growth.
"During the 1980s things were too good to be true," said Hector M. Torres Jr., director of economic development for the Greater Hartford Chamber of Commerce. "We needed a little reality. But I certainly wasn't hoping for this much of it."
Thanks to falling energy costs, an abundance of skilled labor and the furious pace of the Reagan defense buildup, Connecticut enjoyed nine years of uninterrupted employment growth that came to a crashing halt in 1990. The prosperity fed a major rush by mall developers and retail chains to expand into the Hartford area. And it fueled a speculative boom in commercial and residential real estate that drove up rents and nearly doubled the cost of many homes.
But the bubble has burst, leaving speculators in bankruptcy, many financial institutions hopelessly weakened and thousands of ordinary citizens wondering what went wrong. During the past three years, the Hartford area has lost about 30,000 manufacturing jobs, cutting deep at places like Colt Firearms and United Technologies Corp.'s Pratt & Whitney Group. But in many ways the area has been hit far harder by the collapsing real estate market. A forest of "for sale" signs sits on what appears to be half the lawns in the city's suburbs, where prices have fallen at least 30 percent in the past year, according to local real estate agents. Commercial vacancy rates stand at more than 20 percent. New construction has virtually stopped.
"People got caught believing there would be a big dollar sign at the end of every transaction," said Larry Davidson Jr., chairman of the Connecticut Retail Merchants Association and assistant to the chairman of D&L Venture Corp., which just pulled a big department store out of downtown's central retail location, the Civic Center.
Even insurance companies, regarded as the region's healthiest industry and the foundation of its economy, have begun to scale back as a result of escalating losses in real estate loans across the country.
"It's getting hard to hold it all together," said one major real estate executive who asked that his name not be used. "Tenants are disappearing from downtown. That causes more despair and more people leave."
A walk through the Civic Center at night is like a trip to a ghost town unless the National Hockey League's Whalers are playing at the rink that is part of the downtown complex.
"Nighttime, daytime, this is the worst business I have ever seen," said Don Dailey of Sterling Jewelers.
Oddly enough, the technical signposts of economic vitality show a Hartford that's carrying on without terrible trouble. By last November, the most recent month for which there are figures, the local unemployment rate in the region was 4.2 percent, up considerably from the previous year's figure of 3.3 percent but still well below the national average.
Connecticut remains the state with the highest per capita income in the country at $23,440, and in Hartford, the medium household income in the Hartford region is a prosperous $42,000. Employment in the key insurance and financial sector was down just 4 percent in the past year.
"It's the calamity that didn't happen," said Nicholas Perna, chief economist at Connecticut National Bank. "But everybody thinks it has. You can't judge the economic health of a region based on ... the picture of a wrecking ball bringing down a hotel. In Hartford, the number of jobs has fallen 1 percent in the past year. Is that a free fall?"
Perna and others agree that the city of Hartford has suffered more severely than the area as a whole. Like many older cities of the Northeast, Hartford has a poor population increasingly in need of expensive services such as health care and drug treatment. But the people who paid most of the taxes have largely fled to the suburbs.
Still, it was the revival of the downtown that came to symbolize Hartford's renaissance for suburbanites and city dwellers alike. Before the boom of the 1980s, Hartford occupied a geographic and symbolic netherworld nearly halfway between New York and Boston, known to all as a somewhat dull Insurance City. The downtown was virtually deserted after 6 p.m., bars and restaurants were few and anything approaching a genuine nightlife was reserved for those adventurous enough to travel elsewhere.
But a decade of success seemed to change all that. The Hartford Stage Co. boomed, the hockey franchise took hold, movie theaters, restaurants and specialty stops found their way downtown. There was actually a cultural life beyond a few visiting symphony orchestras. Thus, for many people here, the biggest fear about this recession is that it will threaten not just real estate prices and hotel rooms and assembly line jobs, but the sophistication and livability of the city itself.