[G]ov. Phil Scott and Senate President Tim Ashe have been having a little data dispute.
On the numbers, the fight was a tie. On the narrative, the governor won, which probably explains why Ashe beat a hasty retreat.
“It was actually a non-issue made a political issue by the administration and I’m happy that it’s over,” Ashe said, as though he had not made it a political issue himself by challenging Scott’s numbers on Vermont’s labor force.
For the last two years the Republican governor has been talking about how Vermont’s labor force is losing six people every day.
No, it isn’t, the Democratic Senate leader said, accusing Scott of “cherry-picking” “dated information.” The latest information, Ashe said, indicated that Vermont’s labor force is actually going up by 2.3 people a day.
Scott shot back that Ashe was the one who was “cherry-picking.”
They both were. Furthermore, the whole “per-day” metric is a political gimmick. It isn’t as though when you wake up tomorrow there will be six fewer (or 2.3 more) willing workers in the state. These changes take place over longer periods of time.
But Ashe is right. At the end of 2017, there were 345,756 people in Vermont’s labor force (everybody who’s working plus everybody who’s looking for work). That’s 1,596 more people than at the end of 2015.
But, then, Scott is right, too, because at the end of 2017 there were 12,737 fewer Vermonters in the labor force than there had been at the end of 2009.
That’s a much bigger decline over a much longer time than the recent, small, increase. Even if that growth rate continues unabated (hardly guaranteed) it would take almost a decade for Vermont’s labor force to get back to where it was in 2009.
That’s why Scott won the narrative, with Ashe conceding just a few days later, “We had a labor force decline over the years and we still have these demographic pressures.” Most Vermonters seem aware of those “demographic pressures.” Businesses are having trouble finding enough workers. Like the labor force, the population has ticked up slightly in the last year or two, according to Census Bureau estimates, but over the last several years it has been stagnant or maybe even falling.
Not that any of this is unique to Vermont, a fact the governor sometimes seems not to recognize. Businesses all over the country complain about a shortage of qualified workers. Fifteen other states saw labor force declines in 2017, when Vermont actually rose by 663. Except for Alabama, they were all cold states in the Northeast, the Midwest, the Plains and the Rockies. Many, like Vermont, are rural. Whatever ails Vermont ails much of the country.
The problem is that precisely what ails them and how the malady can be cured – or if it can be cured – remains a mystery. So far, the governors, legislators, businesspeople and scholars in all the affected states have not figured out what to do. Otherwise, they would have done it.
Like its neighbors, Vermont will always be cold (if a bit less so in coming years). Unlike most of its neighbors, it has only one metropolitan area, and it’s a small one in an era when economic growth is increasingly concentrated in the larger metros.
And like its neighbors, Vermont is old and white. Older people don’t have babies, and non-Hispanic white people are having few. That’s why “states like Vermont have to go through the migration route” to attract more people and workers, said Qian Cai, the director of the Demographics Research Group at the University of Virginia’s Weldon Cooper Center for Public Service. Even if more women of child-bearing age lived in the state, she suggested, they wouldn’t be likely to have many children. The birth rate (births per 1,000) for white Anglo women is 1.9, she said. That’s “below replacement level.”
For Vermonters, the Weldon Cooper Center has some sobering information — a projection that the state’s population will hold steady for the next decade or so, then fall from 626,000 to 612,877 in 2040. By then it would be smallest state; Wyoming now about 560,000, would grow to 688,396.
Projections that far ahead, Cai said, are less accurate. They assume that population the trends “we have observed in the past” will continue. That doesn’t always happen.
“It’s possible that by 2040 the pendulum will swing again,” she said. “Lose enough population and new opportunities may arise.”
Cai does not believe a state needs a large population to prosper.
“Population decline is not necessarily a bad thing and population growth is not necessarily a good thing,” she said.
Most economists agree. But they think a state needs at least a stable labor force if it is to have a healthy economy, and Vermont’s labor force decline is significant. In only five other states is the labor force smaller than it was five years ago, and only in West Virginia has the decline been steeper.
Everybody knows why West Virginia’s workforce declines. There’s a lot less coal mining, and laid-off miners have few other opportunities, so they leave. Vermont’s labor force goes down less because people leave — though some do — than because others are not moving in fast enough to replace both those who move out and those who die.
Vermont doesn’t need a huge labor force because it has a high labor force participation rate (people available to work as a percent of the total population) — 67 percent, compared to a national rate of 62.7. Vermonters, it seems, like to work. Still, the state would benefit if it could convince a few thousand people — or at least a few hundred — to move in, especially people who are between 18 and 54 years old. Those are the most likely workers.
How to do that — if indeed it can be done — is the question, and while Gov. Scott has won the political narrative of the month, he has not necessarily won the long-term policy debate. His plan to spend $3.2 million on an online portal to recruit young professionals is at best un-tested. Others have suggested that the state target immigrants from abroad or concentrate on attracting people from neighboring states.
Qian Cai, the Weldon Cooper Center demographer, said “economics is the driving force” behind most migration from one state to another. Job opportunities are the most important factor, she said, followed by housing.
Democrats think people may be reluctant to move to Vermont because Republicans — including Scott — keep complaining about how hard it is to find workers and how high the taxes are. Republicans argue that some don’t move in because the taxes are too high, and that others — especially the wealthy — move out for the same reason.
Nationally, the data does not support the argument that many people move in or out of a state because of taxes. The Republican claim that more people would move in and/or fewer move out if taxes were lower is conjecture. In general, rich people are less likely than others to move at all. “And when they do,” according to an article in the very conservative Forbes magazine, “there is little evidence that their choice is driven by taxes.”
That nationwide finding may not apply to Vermont, though. The state is so small that it could be peculiarly impacted by the decisions of relatively few people. A mystery worth pondering another day.
