Jon Margolis is VTDigger’s political columnist.
[H]ave you noticed that there is no longer any such thing as a “problem”?
Now some “problems” have become “issues,” as in your online computer repair person asking if she has “resolved your issue.”
But an issue, says the dictionary, is “a matter of public concern,” or “a matter of debate, discussion, or dispute.” Whether to build a wall along the Mexican border is an issue. Losing your internet connection is a problem.
Exactly how some “problems” became “issues” is unknown. Less mysterious is how other “problems” became “crises.” It’s just good old-fashioned political hype. It serves the interests of some politicians to say that the situation along that Mexican border is a crisis, which it is not, though it may be a problem, as well as a (real) issue.
Here in Vermont we have what Gov. Phil Scott calls the “demographic crisis,” also known as the “labor force crisis.”
Problems these may be. The most recent estimates from World Population Review shows a 2019 Vermont population of 624,263, minimally below the confirmed 2010 population of 625,741.
A stable or shrinking population does present problems. Fewer folks makes it harder for businesses to find workers, or homeowners to find a plumber or gardener. But there’s also less traffic, more room on the bike trail.
Vermont’s population is growing in one way: older. Nineteen percent of Vermonters but only 16 percent of all Americans are older than 65 (data here from the Henry J. Kaiser Family Foundation). Many Vermonters have aged out of the work force.
That could explain why there were 16,712 fewer people in Vermont’s labor force (either working or looking for work) last month than there were in April of 2009. That’s a big drop, and Gov. Scott is not the only one worried about it.
But if it’s a situation that’s been developing for almost 10 years, it’s not a crisis. A crisis is a “sudden change,” a “crucial or decisive point.” Neither sudden changes nor decisive points occur over 10-year periods.
Besides, those numbers fluctuate. The labor force is bigger now than at its low point in October of 2015. Perhaps that’s partly because not everyone stops working at age 65. If they did, you wouldn’t be reading this.
While the number of potential workers has dropped at a healthy (or unhealthy) clip, the number of people actually working has held steady. At the end of last year, there were slightly more people employed in Vermont than in any of the previous five Decembers.
But “held steady” does not mean “growing.” Again, this may not be a disaster. Some economists prefer what they call a “steady state economy,” one of “stable or mildly fluctuating size.” The world being finite, they have a point.
But whether or not it’s a problem, Vermont’s minimal economic growth has been going on for more than a decade. So it’s not a crisis.
It may seem so to businesspeople who can’t find enough skilled, qualified workers to fill the jobs they have available. That’s a real problem, but not just in Vermont. Jobs are going unfilled all around the country, partly because Americans haven’t been having many babies lately.
Businesspeople unable to find enough workers might revisit their Economics 101 textbooks to find one possible solution: raise wages. Labor is commodity. The textbooks say that when demand for a commodity goes up and the supply does not, the price (wage) rises, leading to increased supply.
Vermont is a low-wage state. Its median wage in 2016 was $18.23 an hour, 17 cents lower than New Hampshire and more than two dollars lower than Massachusetts and New York., according to Bureau of Labor Statistics data calculated by the magazine Governing.
Perhaps one reason Vermont wages are lower is that Vermont workers are less likely to belong to unions. According to the Bureau of Labor Statistics, 11.6 percent of Vermont employees are represented by unions, the same as New Hampshire but lower than the other neighbors.
Actually, America is a low-wage country. Of all 36 nations in the Organization of Economic Cooperation and Development, only in Latvia do a greater percentage of employees work in low-wage jobs (paying less than two-thirds of the country’s median wage). Here again, the relative weakness of unions could be a factor.
Even if lots of workers aren’t necessary, a small labor force could pose “a barrier to growth,” said Labor Department economist Mathew Barewicz in an email exchange. Without more workers, he said, “regions must look to the other two ‘engines’ of economic growth.”
That would be natural resources and productivity. Finding natural resources which have not already been discovered and exploited seems unlikely. Improving productivity by training workers to qualify for more jobs is feasible, but expensive.
It isn’t that the state couldn’t use more workers. It’s that what the state is now doing to find them won’t find very many. Joan Goldstein, the commissioner of the Department of Economic Development, said five people have moved to Vermont thanks to the $10,000 legal bribe (she didn’t use that term) the state offered last year to entice “remote workers” to move in.
That’s five in one month, because the program didn’t take effect until Jan. 1. But that doesn’t mean 60 will move in this year. The Legislature adopted the idea last spring, and it got six months of national publicity.
This year Scott is proposing a broader program of $5,000 inducements for all kinds of workers to move to Vermont. Goldstein said “people do respond to this kind of incentive.” But she agreed that considering the resources available (the governor proposed spending $1 million for the first year), the new plan is likely to add no more than a few score newcomers – or at best a couple of hundred – to Vermont’s labor force.
At that rate, it would recoup its losses since 2009 in about a century. That’s not the way to deal with a crisis.
