Doug Hoffer: Facts matter — jobs and the economy

Editor’s note: This commentary is by Doug Hoffer of Burlington. Hoffer is Vermont state auditor but the views expressed here are his own.

Voters receive a lot of information during campaigns and it’s important to check the facts. For example, Lt. Gov. Scott recently said “We’ve lost nearly 2,500 workers per year since 2010” (Aug. 31 Burlington Free Press).

This is true, but misleading. Workers are part of the labor force, which consists of those who are working and those who are unemployed but want to work. The issue is that counting workers is not the same as counting jobs.

According to the Bureau of Labor Statistics (BLS), 84 percent of those 65 or older retire. At that point, they are no longer part of the labor force. Vermont’s population of those 65 and older grew by 18,000 from 2010 to 2015. During that same period, the labor force shrank by 15,000.

While the labor force dwindled, we added over 15,000 new jobs (Vermont Department of Labor, see below). Thus, a shrinking labor force and increased jobs are not mutually exclusive and to focus on the labor force while ignoring jobs misrepresents the facts and the complex reality of the labor market.


Unfortunately, Mr. Scott doubled down on his misleading statement when he asserted in his economic development plan that the decline in the workforce “amounts to a loss of about $750 million in potential wages.” When working Vermonters retire they are replaced by other workers so there is no loss of wages. Moreover, the addition of 15,000 new jobs resulted in hundreds of millions in new wages.

Mr. Scott also said that “our economy is growing too slowly.” Concern about the sluggish recovery from the Great Recession is understandable, but it’s not unique to Vermont. Job growth is below the U.S. average in all New England states (see below).


Other measures illustrate the national scope of the problem. For example:

And it’s important to acknowledge that states are at the mercy of powerful forces such as the federal budget, interest rates, trade agreements, currency exchange rates and cheap labor overseas.


• Percent change in per capita GDP, 2010-2014 (U.S. Department of Commerce, latest available): By this measure, most of the country is struggling. Ten states were negative (including four that have no personal income tax) and 35 are below the U.S. figure, including Vermont. Even New Hampshire, which benefits from the Boston metro area, is well below the U.S. figure.

• Percent change in inflation-adjusted median household income, 2010–2015 (Census, latest available): Although Vermont has improved, 22 states have lost ground, including four Northeastern states.

• Jobs lost to foreign competition (U.S. Department of Labor, Trade Adjustment Assistance Program): Vermont lost 1,500 jobs to foreign competition from 2010 to 2015. That equals less than 1 percent of all private sector jobs and puts us right in the middle of the pack.

On the other hand, not all of the news is bad. For example:

• Net change in business activity (Bureau of Labor Statistics): From 2011 to 2015, 500 more businesses opened than closed in Vermont (7,900 new businesses vs. 7,400 closed). Likewise, 20,000 businesses expanded, while 18,000 contracted.

• Net tax-supported debt as a percent of personal income (Moody’s): At 2.1 percent, Vermont is better than 30 other states. Moreover, Vermont is one of only 15 states with Triple A credit ratings from at least two of the three ratings agencies.

• Bankruptcies per 1,000 residents, 2015 (American Bankruptcy Institute): Vermont is third lowest in the country.

This is not the story told by those (like Mr. Scott) who would have us believe that Vermont is an economic basket case and that it’s impossible to do business here. We have problems, but we’re not alone.

And it’s important to acknowledge that states are at the mercy of powerful forces such as the federal budget, interest rates, trade agreements, currency exchange rates and cheap labor overseas. These are beyond the reach of state policy, regardless of which political party is in power.

So let’s have a wide-ranging conversation about the economy, but let’s make sure it’s based on all the facts, not just those that tell one side of the story. And let’s talk more about real proposals for the future rather than sound bites. There’s too much at stake for anything less.

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  • This piece raises good points, but seems to neglect another side of the story — out of control state spending. Whatever the true growth numbers are, this state has been on an out-of-touch spending binge which had nothing to do with “…powerful forces such as the federal budget, interest rates, trade agreements, currency exchange rates and cheap labor overseas.” Perhaps our auditor will share his personal opinion about that little elephant in our living room.

    • Doug Hoffer

      Actually, the elephant is quite a bit smaller than some suggest. According to the Joint Fiscal Office, the state’s annual appropriations of state-only funds (excluding federal funds) as a percent of GDP, personal income and AGI, is almost exactly what it was ten years ago. See the 4th item on the right side.

      Part of the reason is that post-recession income growth has resulted in a lot more tax revenues. In aggregate, total income for all those earning more than $100,000 grew $3.7 billion from 2010 to 2014 (latest available). That produced over $150 million in new tax revenue.

      In any case, I’m not sure the data supports your assertion that “this state has been on an out-of-touch spending binge.” But that’s for another day.

      • Thanks for responding. But that is my point — I think the two conversations are linked. I thought I read that our State budget increased (in real dollars) some 4.5 %, largely funded by increased fees. Are you saying this is not true? And if so are you alleging more perversion of statistics in that regard? I am actually just asking…

        • Doug Hoffer

          Got it. Unfortunately, my lunch hour is over so I need to get back to work. If time permits later, I’ll get back to this.

        • Tom Sullivan

          Hey John,
          I believe you might be referring to H.875, the $5.8 Billion FY17 Budget . The $1.47 billion general fund portion of the budget increases by 4.8 percent, while revenue is projected to grow at just 2.2%.

          • Doug Hoffer

            According to the Joint Fiscal Office, that is not accurate. I plan to write more about this later, but for now here are some facts BEFORE adjusting for inflation. Growth in appropriations from FY 2016 to FY 2017.

            3.9% General Fund
            3.3% General Fund and Health Care Funds (SHCRF)
            2.6% All State Funds, including Transportation, Special Funds, etc.
            1.6% Total State Funds, including Net Education Funds

            These are all monies raised in Vermont. This is very different from what you’ve heard from the Republicans.

          • Willem Post


            Please show the dollar amounts and URLs, so we can verify.

          • Tom Pelham

            Here’s JFO’s profile of the budget passed by the legislature and signed by the Governor at the end of the last session.


            Here’s their current profile of the budget given the July revenue downgrade and the subsequent rescission approved by the Joint Fiscal Committee. (See last page for totals)


            At the current fiscal 2017 level, since 2010 when the majority party took control of the state budget by its override of the Douglas veto, general fund spending has grown at the annual rate of 5% and total state dollar spending at the annual rate of 4.8%.

            Keep in mind that the fiscal 2017 budget is not final as the mid-year budget adjustment has yet to be considered. Last year, the 2016 budget adjustment added $28.5 million in state dollars to the bottom line.

          • Doug Hoffer

            Tom – You’re ignoring growth in income and the economy. See the JFO data on the state budget as a percent of GDP, personal income, and AGI. We are almost identical to where we were ten years ago. The economy grew after the recession and the budget grew with it.
            See “Vermont State Appropriations Compared to Income”

          • Tom Pelham

            Your jobs chart profiles the private sector’s response to the recession. Along with reduced labor costs, the private sector survived by being more efficient. To the contrary, our state leaders abandoned reforms and grew the budget with one-time federal ARRA funds in 2009 – 2011 and once ARRA funds ran dry, grew spending by raising taxes and fees, expanding tax bases, reducing tax deductions and allowances, among others. If state dollar spending since 2010 had grown at a reasonable 2.5% rate, the tax and fee burden on Vermonters today would be $346 million lower.

            I’ve looked at the JFO data you cite. It’s a manipulation.


            Notice the “Note” that federal ARRA funds are included as “state funds”. Thus, the JFO flatten the growth curve by expanding the definition of “state funds” in 2009, 2010 and 2011 by $76.3 million, $202.2 million and $158.8 million respectively in federal funds.

          • Doug Hoffer

            Tom – You are focused on the changes since 2010 and I understand why. However, in addition to it being the year Gov. Douglas’ budget veto was overridden, it was also the depth of the greatest recession in 75 years so it may not be the best benchmark. In any case, if we look at the longer-term trend, we are in virtually the same place we were ten years ago during the Douglas administration. Here are the figures for the state-only budget.

            As a percentage of GDP:
            FY07 11.5%
            FY16 11.6%

            As a percentage of Personal Income:
            FY07 11.7%
            FY16 11.8%

            As a percentage of Adjusted Gross Income:
            FY07 17.5%
            FY16 18.2%

            If those ratios were OK during the Douglas administration, why not now?

          • Willem Post


            Some items are off budget, such as the EV surcharge on electric bills, that pilfered $55 million from people’s pockets in 2016.

            Efficiency Vermont spends about 45% of its budget on various expenses, which an inefficient way to do energy efficiency. See the Andrew Rudin URL, which shows the Efficiency Vermont way of doing EE is not efficient at all, despite their glowing reports. EV should be closed down, which would eliminate about $56.2 million of EV surcharges on 2016 electric bills of already-struggling households and businesses.

            In 2014, EV budget $45.9 million, and used about $18.9 million for various expenses, and spent $22.9 million on subsidies for participants.
            In 2015, EV budget $52.2 million, and used about $19.6 million for various expenses, and spent $23.6 million on subsidies for participants.
            EV budgets totaled about $643 million for the 1992 – 2017 period.

            Look at the 2000 – 2015 period for much less biased revelations.

          • Willem Post

            I have a write up, which I would like to send you, which has all sorts of economic data regarding employment, incomes, growth, etc.

            I would be pleased, if you would review it and make comments.

            Anne Galloway has my email address.

          • Willem Post

            Here is some data straight from the top, with numbers and URLs:

            Excerpt from a VTDigger article: “Shumlin said that under his tenure, budget growth averaged 3.7 percent while gross state product averaged 3.2 percent.”

            Using Shumlin’s numbers, state government budget growth has been 100 x (3.7/3.2 – 1) = 15.63%/y FASTER than gross state product, GSP, growth during each of the past 6 years, while:

            – Vermont population growth rate was near zero
            – Median household real income decreased
            – Real GSP growth rate was slightly positive

            Such government budget growth has been unsustainable since 2000, i.e., started well before Shumlin

            Instead of a strong, vibrant private sector lifting a 100 lb. weight in 2000, a weak, anemic private sector had to lift a 125 lb. weight in 2015, with no relief in sight, due to continued future growth in government spending


          • Willem Post
        • Jay Eshelman

          ‘New’ wages? Of course this statistic is overstated by virtue of its context in time. Mr. Hoffer’s graph clearly shows that private sector jobs increased by only 5000+- jobs from the peak under the Douglas administration prior to the 2008 financial collapse to the peak of the Shumlin administration today.

          And how many of those additional ‘private sector’ jobs were the result of ‘shovel ready’ government subcontracts or government subsidized contracts? With state and federal road building, solar and wind generation contracts, the Waterbury State Office Complex, the new State Police complex in Westminster, subsidized low income housing construction and the like, it doesn’t take a lot of hiring to increase employment by a mere 2% above 2008 levels.

          Do you see how easy it is to cite statistics to suit one narrative or another?

          • Willem Post


            Labor force percent participation is lower than in earlier years. Doug likely has data on that going back to 2000.

          • Jay Eshelman

            And consider that Vermont is funding what anemic growth it has with a deficit now over $3.2 billion, with $2.6 billion in ‘unreported’ retirement liabilities.


            No…Vermont’s debt per capita isn’t as bad as Massachusetts, Connecticut and some other states. But Vermont has the 12th worst debt per capita in the U.S.

            I’m also concerned when the State auditor takes on a partisan roll in our politics. The auditor ought to be an appointed position, confirmed by the State congress, as judges are.

          • John Fairbanks

            How is providing context and, where necessary, correcting the record, “partisan”?

          • Willem Post


            Doug’s article will provide aid and comfort to Democrat legislators facing the voters.

            They need to have talking points to defend their miserable record.

            With their veto-proof majorities, they have driven Vermont’s economy into the tank;

            Here are just a few symptoms of dysfunctional governance:

            Healthcare website
            Insanely expensive, environment-destroying energy policies
            Wood-fired District Heating Plant in Montpelier
            Repeating budget deficits
            Expanding a bloated government
            Out-of-control education budgets
            Out-of-control healthcare budgets
            Increasing taxes, fees and surcharges on the hollowed-out, anemic, shrinking private sector.

            With the help of Tom Pelham, who knows the numbers as well as anybody, we might get a clearer picture of the real situation for the entire 2000 – 2015 period, instead of looking at just the good part of that period.

          • Doug Hoffer

            Don’t you just hate it when government spends money on roads, bridges, replacing state office buildings destroyed in 500 year floods, police facilities and affordable housing? What were they thinking?

          • Jay Eshelman

            Who’s providing the context, Mr. Fairbanks? Apparently it’s not OK when congress ‘cooks the books’….. []….. but it is okay when Mr. Hoffer does his version of ‘dynamic scoring’.

            No one said building roads and bridges was a bad thing. No one said building State office buildings was a bad thing. But when you cite government spending as evidence of an improving economy and fail to point out its context in time and the effect of rising taxes and increasing debt, it’s not just partisan….its disingenuous.

            Who’s correcting the record? Who do you think you ‘re kidding? Welcome to Vermont’s version of ‘Wonkville’.

          • Doug Hoffer

            It was you Mr. Eshelman who raised the issue of public spending having boosted the job figures, not me. You referred to “‘shovel ready government subcontracts or government subsidized contracts…state and federal road building, solar and wind generation contracts, the Waterbury State Office Complex, the new State Police complex in Westminster, subsidized low income housing construction and the like.”

            The post-recession shovel ready projects were supported by ARRA funds in every state in the country, but that stimulus ended years ago.Similarly, the construction jobs related to the Waterbury complex and the Westminster barracks are long gone, as are any construction jobs related to completed solar & wind projects.

            And yet we still have 15,000 more private sector jobs. Go figure.

          • Jay Eshelman

            Correct. I compared your citation of a 15K jobs increase from 2009, the low point that occurred as a result of the 2008 financial debacle, to the increase in jobs from the high point of the Douglas administration only one year earlier that was only 5K jobs over 8 years. And I said those jobs were the result of ‘shovel ready’ government subsidized projects corresponding with increasing taxes and debt.

            Your Keynesian monetary policy advocates government spending to stimulate periodic slow growth in an otherwise cyclical free-market economy. But you consistently de-emphasize the debt incurred by government spending that must, at some point, be repaid. The result of this economic guidance is currently reported by some sources as a $3.2 Billion dollar Vermont debt, 12th worst in the U.S., and Vermont’s 3rd worst rating in the U.S. for high taxes.



          • Doug Hoffer

            You are conflating two different issues. State borrowing for capital investments has been managed very well. That’s why Vermont is one of only 15 states to have a Triple A rating from two or more of the ratings agencies. Vermont’s total net tax-supported debt is under $600 million; not $3.2 billion. The figure you cited is the result of adding estimated pension and retiree health care costs. Those costs are substantial (and the Treasurer is making progress), but have nothing to do with “Keynesian” monetary policy. Moreover, state capital spending is an essential foundation for the entire economy and the resulting job creation is a major bonus. In any case, the jobs created by the post-recession stimulus are gone and are not part of the net new 15,000 jobs I mentioned.

            Finally, the methodology used in your link regarding Vermont’s so-called ranking for taxes is fatally flawed and has no relationship to real world outcomes.

          • Jay Eshelman

            Re: ‘Real world outcomes’??? I’m not ‘conflating’ anything, Doug, you and the rest of the world are. Job creation based on disproportionate government borrowing is nonsense.

            State borrowing has been well managed???? So, you have a good aim when you shoot yourself in the foot.

            And it’s not just Vermont. The whole world is mortgaged to the hilt.

          • Doug Hoffer

            Yes. Real world outcomes. Here is a quote from Grading Places regarding the ranking scheme you highlighted.

            “There is no point, really, in trying to assess whether the SBTCI successfully predicts which states will do better in attracting business investment, creating jobs, or the like. If it does, it is purely by accident, for the index does not even measure the effect of a state’s tax system on the firm’s cost
            of doing business, as we have seen with the COST cross-walk. So even if the index appeared to be correlated with growth, one could not conclude, as the Tax Foundation would like, that lower taxes cause growth. The index does not measure tax rates to begin with, or even correlate with
            relative business tax levels. As a tool for assessing public policy, it is fatally flawed, notwithstanding its carefully groomed appearance of plausibility and academic credentials (however spurious).”

            Read that chapter to understand why he said that.

          • Jay Eshelman

            I don’t know if you’ve ever run a business, Doug. But when I want to borrow money for business expansion, I have to demonstrate my ability to repay the debt within a given amount of time and at specific interest rates, either with profits from the expansion or with my own savings if my projections fail. You, on the other hand, as a representative of the State, don’t have to do either because the State fall back is, inevitably, on the taxpayers. For you, everthing is ‘accidental’.

          • Jay Eshelman

            Re: “net tax-supported debt is under $600 million”. More financial slight-of-hand (dynamic scoring??).

            Yes, it’s not all ‘tax supported debt’ yet. But the obligation to pay $3.4 billion in bonds and $1.3 billion in unfunded retiree health benefits, for example, will come due sooner or later and the longer Vermont’s economy flounders, the more Vermont tax payers will be held accountable.

          • Doug Hoffer

            Again, you are mixing apples and oranges. Bonded debt is paid entirely with tax revenues. Pension obligations are paid with some tax revenue, but also with the returns from the capital invested on behalf of the retirees. In this case, the pension funds total $4 billion so even modest returns produce significant amounts of money.

          • Jay Eshelman

            Apples and Oranges? A rose by any other name would smell as sweet.

            The projections used to calculate the returns from the capital invested may or may not be sufficient to cover the benefits. If the projected returns are realized, the debt is paid on time and indebtedness decreases. That’s not the case in Vermont. The State’s indebtedness is increasing. And everything the State borrows and then spends beyond its returns is paid by taxes sooner or later…which means taxes will continue to increase. Not only are you are robbing Peter to pay Paul, when you pay Paul, you increase his taxes to repair the waste of your system.

          • Jay Eshelman

            Re: Vermont’s bond rating.

            Wealth Matters By PAUL SULLIVAN APRIL 22, 2016
            Municipal Bond Defaults Shake Up a Once-Sedate Market

            Go ahead…cite S&P’s and Moody’s ratings on Vermont bonds. But I remind everyone that these are the very same folks that almost single handedly brought us the 2008 financial melt-down when they gave a false sense of security with the AAA ratings on sub-prime mortgage derivatives.

          • Doug Hoffer

            Actually, they are not the same folks. The ratings agencies have entirely different staff evaluating the credit worthiness of states vs. sub-prime mortgages.

          • Jay Eshelman

            And what makes you think those agency staffers in one office are acting differently from those in the other office? They could be worse.

            As the recent article states, ‘ Municipal Bond Defaults Shake Up a Once-Sedate Market’.

            Just curious… you own any Vermont muni bonds?

        • Doug Hoffer

          In fact, it is not true, Fees are a small part of state revenues. State revenues increased because the economy improved after the recession and tax revenues returned to pre-recession levels. Moreover, as I said in response to Mr. Pelham, using 2010 as the base is misleading because it was the low point after the recession. As a percentage of GDP, personal income and AGI, the state budget now is nearly the same as it was in 2007 before the recession. I hope to write another commentary about this subject to set the record straight.

      • Willem Post


        You case would be more revealing, if you used 2000 to 2015 as the study period.

        Government Employment Growth: During the 2000 – 2015 period, the Vermont government sector employment percent of total jobs grew, whereas the private sector employment percent shrank; a backwards way to go.

        Vermont government employment increased much faster than the population, about 13.56/2.7 = 5.02 times faster.
        Vermont government employment increased much faster than private sector employment, about 13.56/2.85 = 3.51 times faster.

        Forbes ranked Vermont the 44th Worst State For Business in 2014.
        Vermont: Most Costly State for Manufacturing (2010).
        Vermont: 3rd-highest in Property Taxes (2010).

        Household Income: The real (inflation-adjusted) median household income DECREASED 2.20%, significantly less than the 19.72% increase in real GSP per capita, during the 2005 – 2014 period.

        State government spending increased 106.11% during the 2000 – 2015 period, 5.28%/y

    • Willem Post


      The graph shows the Douglas economy had 255,000 jobs in 2006, 2007, then the big recession hit, and almost 10 years later the job total is 260,000 at the end of the Shumlin economy.

      With that tiny job growth came stagnant real household incomes, and rising real costs, especially in education and healthcare, and rising real taxes, fees and surcharges.

      That means the real standard of living of most households went BACKWARDS.

      And what is the general QUALITY of these jobs. Are they:

      Long term
      Full time
      Good paying
      Good benefits
      Good prospects for advancement.

      The above is applicable to the government sector, but not the private sector, which is living with a shattered American Dream.

      Government employment growth, including quasi government entities, has been much greater than private sector employment growth, about FIVE TIMES GREATER, since 2000.

  • Dan Carver


    Thank you for the facts and figures to help start the conversation. Would you be able to shed some light on some related figures? Given the positive picture the graphs and narrative support, one would assume the amount of money spent on unemployment and social support programs would show a significant decline.
    In all seriousness, with the increases businesses have been paying due to an increase in the unemployment tax rate, and changes made to not pay the unemployed until their severance packages or unused vacation time has been consumed–changes made during the great recession–the fund should be in a solid position. With all the job creation, the demand for other welfare services should also be in decline.
    What do the facts and figures say about these areas. Thank you in advance for your service and for sharing the data.

    • Doug Hoffer

      Good question. First, I did not paint a “positive picture.” I debunked some myths about the state of Vermont’s economy but acknowledged we have problems, just like our neighbors.

      According to the VT Dept. of Labor, the Unemployment Insurance (UI) Trust Fund Balance has grown 73% in the last year ($157 million in April 2015 to $271 million in July 2016).

      Total initial UI claims declined 8.5% from 2014 to 2015 (43,580 to 39,885).

      • Willem Post


        (Good question. First, I did not paint a “positive picture.” I debunked some myths about the state of Vermont’s economy but acknowledged we have problems, just like our neighbors.)


        You mean EB-5, biggest fraud?

        Or Healthcare website, the most expensive in the nation?

        Or Montpelier Heating Plant receiving 100% of its $20 million cost as a government grant?
        If that were a private plant, it would lose at least $2.5 million/y

        Or statewide social unrest because of insane RE policies?

  • Mary Ezenwa

    Facts matter, Doug Hoffer!! Add a call for action for further investigation by Neutral Investigators. Lt. Gov. Phil Scott is a morally upstanding leader who tells the truth and succeeds in leading ethically. Respectfully, you owe Lt. Gov Scott a personal apology.

    • Willem Post

      Vermonters have become used to all the lies and misrepresentations of the past 6 years, they likely think they are true, because they are repeated so often.

  • Joe Perry

    When a worker retires no lost of wages?
    I replaced a 45 year retiree. I’m sure my starting wage was 50 to 60 % of the retiring workers wage. I like you Doug, but you have no idea how public wages work.

    • Doug Hoffer

      You are correct of course. But I was responding to Mr. Scott’s assertion that the loss would be $750 million because he assumed that 1) those lost “workers” equaled lost jobs and 2) that none of the jobs were replaced. Both assumptions are incorrect.

  • Eric Davis

    Vermont is not an economic basket case, but by some measures, including private sector job creation, it is lagging other states in the region. More importantly, VT’s aging population is one of the principal reasons why the state’s potential growth, and the revenues available to state government, is lower than it could be if there were more younger workers in the population. Also, too many of the new jobs created in recent years have been part-time and/or low-paid jobs in the service sector. To me, increasing the number of people between 25 and 45 who live in Vermont, especially outside of Chittenden County, and are employed in jobs paying close to or above the state’s median income, is one of the biggest challenges facing state government, the business community, and Vermonters in general, in the short- and medium-term.

    • Moshe Braner

      So we “need” to keep increasing the population so we can have endless “growth”? At even a “modest” 2% per year population growth, the Vermont population in 9 generations will equal what is now the total US population. As Michael Pollan has said, “unsustainable” does not mean immoral or ugly – it means impossible. And the “growth” only benefits the banksters.

      • Willem Post


        Population growth was near zero for hundreds of years, and people got along just fine.

        It was not until fossil fuels were more widely used, starting in 1800, that out-of-control population growth took place; an historical aberration.

    • I share the concern for demographic shifts — but when did it become the province of government to “increase the number of people between 25 and 45 who live in Vermont”? Are we chickens to be rerouted like labor inventory? I refer to the extensive writings of Wendell Berry on this subject — this issue goes to the core of economic sustainability, and the government’s role therein.

    • Doug Hoffer

      You said ” too many of the new jobs created in recent years have been part-time and/or low-paid jobs in the service sector.”

      First, what is your source for the growth in part-time jobs? Second, do you have evidence to show that the growth of comparatively low-wage service jobs is unique to Vermont?

    • Willem Post

      Having a job is one thing, but having a job that is steady, full time, pays good wages, has good benefits (like a government job), is quite another thing.

  • James Rude

    I would like to see the same type of analysis on the taxing and regulatory impact of state government on the citizens of VT. For example, to what extent is Vermont’s high tax rate contributing to the real or perceptive view that economy is not doing well?

    • Doug Hoffer

      Actually, Vermont’s effective tax rates are not that high. What those rankings always refer to is the relatively high top marginal rate (8.95%). But that only applies to the first dollar over $411,500. As a result of our progressive tax structure, the effective rate for the high end filers is actually 5% – 6%. Note also that as the Blue Ribbon Tax Commission pointed out five years ago, our rates apply to federal taxable income, which is much lower than AGI. So our rates look artificially high.

      In any case, there is ample data that income tax rates are not nearly as important as some would have us believe. Indeed, the data on a number of standard economic development measures show Vermont does better than half the states with no personal income tax. The point is that the rankings often ignore real world outcomes.

  • J. Paul Sokal

    Thanks for the richer tale which seems more in line with reality. The economy is very challenging and many of us would benefit were it better, but, we need to consider our circumstance in its real context and not in some imaginary perfect world.

  • What an intelligent and sober-minded commentary, in keeping with the many even-handed, fact-laden reports that Mr. Hoffer has produced as state auditor.

    I’d like to see Mr. Scott respond to this commentary in detail, and I’d also like to see what Mr. Hoffer has to say about Sue Minter’s economic proposals.

    And, boy, would I like to see Hoffer weigh in on the economics of alternative energy in this state, especially wind. Now that’s a complicated issue (about which all kinds of “hot air” has been blown) that could benefit greatly from this sort of analysis.

    • Willem Post


      With regard to RE, anything goes because Vermont saving the world.

  • Tom Pelham

    The “jobs” graph above affirms the bungled fiscal policies of Gov. Shumlin. Despite the graph’s labels, Jim Douglas does not own the great recession that drove jobs from 254,000 in 2008 to 241,000 in 2010 and Peter Shumlin did not restore the job count to 259,000 in 2016. The driving forces behind the great recession and its recovery were national in scope and well beyond the control of Vermont’s governors.

    The graph does reveal that from the peak job count during Douglas to that of Shumlin’s that net new jobs totaled only 5,300. Thus, from 2008 to 2016 the rate of net new job growth was a mere one-fourth of one percent. Yet, Gov. Shumlin and the legislature grew state dollar spending by over 5 percent annually since 2010. State spending is controlled by the Governor and as evidenced by job growth, among other indicators, Shumlin’s fiscal legacy has been at severe odds with growth in the underlying economy, requiring new taxes and fees to close “budget gaps” each year.

  • Mark Keefe

    Doug, thanks for the information and summation. On the private sector jobs graph is that full time work or all work? Just curious what the mix is of f/t and p/t work in the state and if it is trending in any direction – thanks.

    • Doug Hoffer

      To my knowledge, the only data available is national. The sample size for the Current Population Survey (source of employment & unemployment statistics) is too small for this particular issue. I will say that as with so many other labor market issues, I would be surprised if Vermont was experiencing something unique.

  • J Scott Cameron

    Why does it worry me when the State Auditor – who should really stay neutral in statewide political races to preserve his position as Vermont’s independent watchdog – comes out with such a one-sided piece attacking the Republican candidate. The fact is that there was really very little job growth under Gov. Shumlin. Further, the Governor and his democratic controlled legislature routinely supported increases in State spending which far exceeded the growth of our economy, a fact not even mentioned in the article. Over the last four years or so Doug Hoffer as often served as an apologist for the Shumlin administration, so this does not come as a surprise. Doug, just do your job. There’s no one to audit you or your office. If there were I’d ask them to find out whether you wrote this attack on your own time or the State’s dollar.

    • Since he is in fact commenting, perhaps he will address my questions about increases in state spending (that he seemed to deny), as related also in Tom Pelham’s comment that “Gov. Shumlin and the legislature grew state dollar spending by over 5 percent annually since 2010.” I would expect that if Mr. Hoffer can aptly analyze Phill Scott’s numbers, he can analyze also the state budget that he has overseen….

    • Mr. Scott Cameron: It worries me too. For me, this is a tough one because I have enormous respect for both Lt. Governor Phil Scott and State Auditor Doug Hoffer. The timing of this piece does suggest it was politically motivated to help candidate Minter.

      The one thing I don’t understand about Vermont is why a person’s party prevents them from walking across the street (in the case of the State Auditor) to the State House to meet with the Lt. Governor about the issues discussed here rather than making such a big public display with this piece in VTDigger? Essentially, why can’t we just roll up our sleeves, leave the rhetoric to the sidelines, forget about party and work together to solve our many state problems?

      Our unemployment rate is artificially low because the number of jobs is stagnant and people are leaving the workforce and new workers are not coming to VT – – in large measure because the Democratic/Progressive parties have made VT unaffordable for the middle class.

      • Doug Hoffer

        With respect Thomas, you are mistaken. The number of jobs is not stagnant. We have 15,000 more jobs than we did six years ago. Moreover, the people leaving the labor force are retiring. That demographic change has nothing to do with Democrats and Progressives. Please re-read my commentary above.

        • Doug – you are the first statewide candidate for office or statewide office holder who has now meddled in the race of another statewide office/election. I think this sets a very bad precedent for Vermont. No matter how you or anyone runs the numbers – – – – you can always interpret them to accommodate your position.

          We have too much partisanship in Montpelier and too little willingness to work together. Your lengthy take-down of the Lt. Governor was disappointing because Phil Scott deserves better. Folks forget that his economic plan was intended to be a blueprint not a comprehensive policy document. The content did not represent “sound bites” as you refer but good faith ideas and considerations we should factor into bipartisan conversations about how to grow the economy.

    • John Fairbanks

      Cheap shot. Doug is not attacking; he is providing facts to give contrxt to and, to an extent correct, the record. I’m sure this was not written on the people’s time, and, given the quality of work coming from his office, I think we can be confident he’s doing his job.

      • J Scott Cameron

        John – I’m glad you’re so sure this opinion (or the myriad responses from Doug Hoffere which appeared throughout the work day) weren’t written on state time. What’s your source? This is not a good role for a State Auditor. We’ve had several political animals in the Auditor position over the years – Ed Flanagan being the worst – and it doesn’t make me happy to see Doug Hoffer – who has done a good job – moving in that direction.

        • Doug Hoffer

          Really? That’s your most pressing concern? Please check the time stamps and you will see my posts are before or after work, or during my lunch hour. Furthermore, serving as State Auditor is an honor and a responsibility I take very seriously. My commentary above reflects my personal views and I’m pretty sure my election as State Auditor does not extinguish my First Amendment rights. If you are concerned about the politicization of my office, please offer evidence that the work of my office does not meet GAGAS standards.

        • John Fairbanks

          Scott, if you’re making the accusation, even by implication, it’s your job to produce the evidence. Doug is not speaking as State Auditor; he is voicing his opinions, based on data, as a private citizen. He gets to do that. He’s been performing this service of informing the public for a very long time.

        • John Fairbanks

          Come a long way since defending William Altman, it seems.

  • Moshe Braner

    Mr Hoffer: first you said that “the labor force shrank by 15,000” due to people getting older and retiring, and then you said that “When working Vermonters retire they are replaced by other workers”. Those two statements seem to contradict each other. Perhaps you can explain that further.

    • Doug Hoffer

      The labor force consists of those who work and those not working but who are seeking work. When jobs become available (sometimes due to retirement) some of those unemployed folks are hired to fill the positions (or hired to fill positions of former co-workers who move into the now vacant positions).

      • Peter Everett

        Do you have any figures for those who are employable (ages 25 – 50) who are, actively, not seeking employment?

        • Doug Hoffer

          Only at the national level.

  • Randy Jorgensen

    The private sector job growth looks like a mirror image of a national snapshot.

    You keep making the excuse that it’s a New England “thing”. IS there an imaginary line that says? “Welcome to New England, we’re sub-par for the most part across the board. Try somewhere else for better results.”

    To fall just ahead of CT and ME isn’t something to be jumping for joy about. .CT has one of the worst housing markets in the country. The foreclosure rate in CT is highest in the country.

    With the exception of MA the NE economy is in Neutral. Why? Because by in large the cost of doing business in NE is not only high but largely unpredictable. Electric rates in NE are among the highest in the country. Costs of living are among the highest in the country. Start there and the region will improve.

    Perhaps VT is okay with being middle of the pact, you’re just part of the Ho-hum region.

  • Brian Hanbridge

    Once again Doug you are letting facts, informed data & opinions get in the way of the daily rantings of the new wave of “Leave a Reply” folks who have taken over Digger in the last year.

  • Thanks to Doug Hoffer for keeping our feet on the ground rather than taking flight with casual “sound bites.” If you haven’t identified your problems correctly, you can’t fix them. BTW: on one of the usual complaints about the “problem” of Vermont’s aging population, this same complaint has been aired throughout Vermont’s history, starting in the 1840s. I refer you all to “Freedom and Unity – A History of Vermont” by Sherman, Sessions and Potash.

  • michael olcott

    There is one thing that was left out of this conversation. per the reporting done last session 1 out of 5 people in VT consume cannabis on their leisure time, this effectively removes them from the labor pool as near all payroll and above jobs require a clean UA. these people are marginalized by our employers,and i have to try real hard to see anything other than socioeconomic discrimination in this policy. It is also hypocritical as most places i have worked would lose 30-50% of the workforce with a surprise UA on any given workday.

  • Lea Terhune

    Thanks for the full picture. Same fear mongering and misapplication of data is coming from mayor of Burlington. Burlington is going to die if residents don’t vote for $21 million TIF subsidy for a 14 story downtown development?