Former Gov. Jim Douglas says the biggest challenge facing Vermont’s economy isn’t high taxes, health care reform, government bureaucracy, or any other hot topic in this season’s gubernatorial race, but instead a long term demographic trend, which indicates that Vermont’s labor force is steadily shrinking.
“Asked a number of times what the greatest challenge is facing Vermont … I always answer without hesitation, because I think it’s something we should take seriously: and that’s demographics,” said Douglas at an annual meeting for Associated Industries of Vermont, a manufacturing industry group.
“If we don’t have people, don’t have human capital here, then nothing’s going to be very successful,” Douglas said. “We have the lowest birth rate in America, we have net domestic out migration for the last recorded year. …We have a declining population in our public schools.”
One solution Douglas suggested highlights another problem. To fix this demographic issue, he said, Vermont needs to become a “more affordable place to live and work.”
“We’ve got to keep our eye on the challenge of demographics and the challenge of affordability, to do what we can to improve life in our state,” he said in his brief keynote speech.
Douglas wouldn’t comment, however, on how the Shumlin administration has handled the economy, upholding a longtime political tradition where governors do not publicly criticize their successors. Neither did Douglas have any strong objections to Brock’s proposal to shrink state government by 10 percent in coming years.
He said he’d endorsed Brock’s campaign publicly, but that otherwise he remained very aloof from politics, especially anything that veered too close to the governor’s race.
In his speech, he mentioned somewhat unfavorably the Legislature’s targeted tax on Vermont Yankee, and uncertainty about financing health care reform, as examples of uncertainty and unpredictability in state policy, which could deter business investment.
As for the big question, the overall condition of Vermont’s economy, Douglas seemed reasonably optimistic.
“We’re in better shape than most states,” mused Douglas. “Unemployment rates are low. …We’ve got a diverse economic base. But I still worry about the future for the reasons we discussed: whether we’re going to have enough of a workforce here to sustain that.”
When the boss of Dealer.com has to ponder whether California or Vermont is a better corporate headquarters, he said, “You’ve got to take that seriously, right? But compared to other places, we’re faring relatively well.”
