Business & Economy

Woolf: Rich town, poor town? No easy answers

VTD Norwich 1
Norwich boasts the highest income of any town in Vermont. File photo by Kevin O’Connor/VTDigger

Art Woolf is a columnist for VTDigger. Woolf recently retired as an associate professor of economics at the University of Vermont. He served for three years as state economist for Gov. Madeleine Kunin beginning in 1988.

With one notable exception, the richest towns in Vermont are clustered in Chittenden County. The notable exception is Norwich, which also boasts the highest income of any town in Vermont.  The median income family in Norwich earned $141,660 in 2017, far higher than second-ranked Shelburne, at $128,000, and double the statewide average of $70,500. Norwich, just across the river from Hanover, New Hampshire, is home to many high paid professionals who work at Dartmouth College and Dartmouth-Hitchcock Medical Center.  

Chittenden County is home to eight of the 11 highest income towns in the state.  Charlotte ranks just behind Shelburne, with a median family income of $126,000. Ten towns have median incomes of over $100,000, and all of them are in Chittenden County except for Norwich, Stowe and Stratton, and Stratton is a tiny town with only 63 families.

Within Chittenden County, Burlington’s $78,000 median income is 10% above the state’s overall median. Family income is measured by the Vermont Tax Department, and includes married-couple and single-parent families, so it ignores people living alone or in unrelated groups.  So Jerry Seinfeld wouldn’t be included, nor would Chandler and Ross, if they lived together in Friends.

Towns that come closest to the state median are Starksboro, Cambridge, Shaftsbury, Woodbury, Stockbridge and Vergennes — so look there for your average Vermonter, at least income-wise.  And although the Tax Department does not calculate it, I estimate the median family income of married couples — which ignores single-parent families — was $83,400 in 2017, and the U.S. Census estimate for that definition of families is $85,300.

There are other pockets of relatively high-income towns, including in Addison County around Middlebury.  Waltham, Weybridge and Cornwall all have family incomes of about $95,000 and Middlebury itself is $85,000.

Another high-income area is the Mad River Valley, with Fayston, Duxbury, Moretown and Waitsfield having incomes of around $90,000.  And nearby Waterbury, although not in the valley, has a similar median income.

At the other end of the income distribution are seven towns with a median family income of under $40,000 — and that means half of all families earn less than that.  Most, but not all, of those towns are in the Northeast Kingdom, and if we look at towns with median incomes of under $50,000, many are also in the Northeast Kingdom.  And these include some of the area’s larger towns, including Richford, where the median is only $41,100 and Newport City at $45,000.

All of Vermont’s traditional cities except for Burlington have incomes lower than the statewide median.  That includes Barre City, Brattleboro, Bennington, Rutland City, St. Albans City, Springfield, St. Johnsbury and Newport City.   All have median incomes below $60,000 and some are below $50,000. 

Why the big differences among all these cities and towns, with a range between $30,000 and $140,000?  Some are due to the nature of jobs in the area, some the skill levels of the population — and those two are very much interrelated.  Some of the differences are due to the differences in the mix of family types. A town with a lot of families where both spouses work is going to have a higher median income than a town with a lot more single-parent families.  And the latter tend to be found more in cities than suburban towns.

There is no magic bullet to raise the incomes of people in lower income towns, or, by that matter, to raise the incomes of low-income families in high-income towns. More job opportunities, better education and skill training for workers, and a more fertile environment for businesses and entrepreneurs to flourish are all important and widely recognized as such.  But they are very hard to design and implement. 

Another way to improve incomes for people is for those people to move to where incomes are higher and there are more opportunities.  That seems to be happening in Vermont, and not just for low income Vermonters.

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Art Woolf

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Jay EshelmanPete NovickChris Katuckiwilliam Farrdoug richmond Recent comment authors
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Laurel Stanley
Laurel Stanley

Just for the record, Richford is in Franklin County which is not part of the Northeast Kingdom.

Art Woolf
Art Woolf

Laurel Stanley: Thanks for the correction, although Richford is on the Orleans County border with Franklin County.

patrick hurley
patrick hurley

let each town handle it own problems instead of making people in south Burlington pay for schools in Benson vt

Ron Jacobs
Ron Jacobs

There are ways to increase the incomes of lower income workers. The most obvious one is to increase their wages. Another is to subsidize their wages or their housing cost. Another is to lower their expenses via rent control. Of course, all the above would require raising taxes on the wealthy, something Woolf seems to reject considering. He is after all, a true believer in capitalism.

John Shaplin
John Shaplin

The numbers introduce quite a bit of fog into the situation. Income statistics don’t say much about what folks are paying out after, like for health and property insurance, interest on debts, childcare, rent, transportation and taxes. And like Art points out, a whole range of folks are not entered into the equation. Nor how many hours they have to work to get what they do and how they like their job. Also, the balance in folk’s budgets between spending and savings. I hear that a lot of folks don’t even have so much as $500 stashed away for unexpected expense, let alone something to supplement S.S. when they retire. Incomes over a lifetime vary significantly. Art’s statistics are a snapshot not a moving picture, which is to say I agree with his point, ‘no easy answers’, the holy grail of most legislative adventures.

doug richmond
doug richmond

Better income towns go with greatly higher rents and living costs.

No silver spoon, except for Vt Gov’t to stop demanding more restrictions
“for the public good”
and restricting the very changes we should be making

william Farr
william Farr

…An interesting article with respect to the ” educated ” out of stater’s spread throughout the state that either travel some distances to get to work or work from home. They tend to buy up or build extravagant homes in many instances in small rural pockets of the state, thereby driving up the appraisals on the locals’ homes, people that are just barely keeping their heads above the water. The folks making less than 40 grand a year, with (2) or more of them working… There has always been this low income/poverty element living in Vermont & they seem to quietly slip between the cracks each time an article such as this comes along.
This is the real Vermont I am acquainted with, people making do with what they got, not living high on the hog.
Not looking for or expecting handouts from anyone… :~)

Chris Katucki
Chris Katucki

Not sure moving to a different part of Vermont for a higher paying job is a desirable solution for a working class family with roots in a community, say when four generations of family members are alive and nearby. Move to make an extra $2-3 an hour in a higher cost of living area – why? Also, writer/journalist Chris Arnade talks about the division in class between what he calls the “front row kids” and the “back row kids. His observations are worth exploring.

Pete Novick
Pete Novick

Thank you Professor Woolf. Please post links to the data sets.

The United States Office of Management and Budget (OMB) delineates metropolitan and micropolitan statistical areas. Vermont has one MSA, Burlington / South Burlington which ranks 203rd in the nation.

MSA’s are not bound by state boundaries.

Brattleboro is relatively poor and that’s why you see plenty of cars with green license plates heading east on Route 9 to Keene every morning.

Why? Because Keene’s economy is booming.

There is no corresponding movement of cars from the Granite State coming to Brattleboro every morning.

Also, the daily flow of tractor trailers leaving Interstate 91 at Exit 3 and heading to Keene continues to grow at steady pace.

As the great collapse of rural economies continues all across the United States, state-centric solutions must be seen for what they are: suboptimal solutions.

Cheers

Jay Eshelman
Jay Eshelman

The ‘fix’ is as plain as the nose on our collective faces.

https://vtdigger.org/2019/09/22/enrollment-declines-have-hit-schools-statewide-not-so-in-coventry/

Economic incentive deniers simply can’t seem to grasp that School Choice and low taxes are a winning formula.

 

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