Art Woolf is a columnist for VTDigger. He recently retired as an associate professor of economics at the University of Vermont.
Vermont’s unemployment rate rose to a record-high 15.6% in April. Unemployment was probably higher during the Great Depression, but April’s rate was the highest it has ever been since state unemployment rates have been measured.
Moreover, Vermont went from one of the lowest unemployment rates in the nation to one of the highest. Only eight states had rates above Vermont. Nevada, with its tourism-dependent economy, led the nation with an unemployment rate of 28.2%.
Within New England, Rhode Island and New Hampshire had rates somewhat higher than Vermont. Massachusetts was slightly below Vermont, and Maine and Connecticut were significantly lower. Connecticut’s 7.9% rate was lowest in the nation. New York, despite the high number of Covid-19 cases and deaths in New York City, had a lower unemployment rate than Vermont.
Just before the economic shutdown, Vermont employers had 314,000 workers on their payrolls. In April, that number had shrunk by 65,000, a 21% decline. Vermont’s job decline, in percentage terms, was the second highest in the nation.
Nearly one-third of the total job decline in Vermont was in restaurants, bars and hotels. Nearly two-thirds of all hospitality sector employees lost their jobs.
With the closure of many parts of the retail sector, almost 10% of retail trade employees were out of work, and retail accounted for 15% of all jobs lost in Vermont.
Despite the job losses being caused by the pandemic, the third most-affected part of the economy was health care. More than 7,000 health care workers lost their jobs, 11% of all the jobs lost economywide.
Another 10% of the total job loss came from idled construction workers. Construction does not employ a large number of people, but nearly half of all construction workers were not working in April.
Will April be the cruelest month for unemployment and job loss in Vermont? It’s likely that unemployment in May will be higher than April’s 15.6% and the number of Vermonters without jobs will also rise. But the increases will not be nearly as dramatic as in April.
I doubt Vermont’s unemployment rate will exceed 20% — still a high number but not nearly the increase we saw between April and May. And payroll employment will continue to fall, but the decline will be a fraction of the April decline.
After that, the numbers should improve. The economy is gradually opening up, and as it does people will slowly return to work. Unemployment will remain high, probably at least through the end of this year.
Vermont’s job count will increase, but only slowly. In December 2019, Vermont had 315,000 jobs. Today we have 248,700. This coming December we will be lucky if we have 300,000.
Correction: An earlier version of this story misstated Vermont’s job decline, in percentage terms. It was the second highest in the nation.
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