Governor Peter Shumlin says the state’s economy is headed in the right direction as the unemployment rate declines and the business climate improves.
Shumlin held his weekly news conference in South Burlington, the business expo organized by the Vermont Chamber of Commerce. The annual event is the state’s biggest business-to-business trade show. So the economy was at the top of the governor’s talking points.
"There’s good news. As you know, in the peak of the recession the unemployment rate was hovering around 8.2 percent," he said. "As we announced a week ago, it’s now down to 4.6 percent, the fourth lowest unemployment rate in America."
Shumlin also talked about a general improvement in Vermont’s business climate. He said that’s reflected in a more positive outlook among business leaders since the 2008 recession.
Chamber President Betsy Bishop agreed with that assessment.
"Over the last two years I think we seen a stability starting to form," she said. "And I would say in my travels around Vermont as I talk to Vermont companies, there is some optimism out there and there’s some sparks of bouncing back. I think it depends on the industry as well. I certainly see some manufacturing coming back; orders are up and some hiring happening."
University of Vermont economist Art Woolf says the governor is right about the trend lines – but that it’s not time to celebrate yet.
"We’ve been gaining jobs now for the last year and a half or so. So the direction is up, so that’s good. It’s just that it’s a very shallow up," he said. "The growth rate of new jobs is very, very low. And we’re still well below our peak of employment back in 2007."
Woolf also publishes the Vermont Economy Newsletter and he says the state faces a demographic problem because the number of available workers is declining. He said a shortage of workers could affect companies’ plans for growth.
"Whether or not we’re going to be generating lots of new jobs, that’s pretty unlikely, both because of the slow growth rate but also because Vermont’s working age population is starting to decline," he said. "So it’s just harder and harder for firms to find people, especially qualified people when you have shrinking population of people who want to work.
Woolf says Shumlin could do more to ease the tax and regulatory pressure on business.
The governor said he won’t be satisfied until Vermonters start to earn more money. "To be working one, two, three, or four five jobs and find out you’re making the same money you were ten years ago and find out you got to fill the car up or the oil tank to heat the house and its 200 percent more than it was 10 years ago," he said. "So we have challenges ahead. When we see the numbers move on income we’ll feel really good."
Shumlin gave credit to the Legislature for helping the economy because it imposed a moratorium on a new tax on cloud-based computer services.