Peter Shumlin, never one to miss an opportunity to take credit for something he didn’t do, recently touted Vermont’s low unemployment rate as evidence that the state’s public policies are, well, working? Is that the right word? Let’s ask the governor himself:
Shumlin, speaking during a news conference at the company’s headquarters near the Burlington International Airport, said the state has been working hard to ensure businesses have enough workers.
“I think it’s worth celebrating that Vermont right now has the third-lowest unemployment rate in America. That doesn’t happen by coincidence,” Shumlin said.
In February Vermont’s unemployment rate was 4.4 percent, tied for the third-lowest in the country.
As has been previously demonstrated here, there’s a reason why Vermont’s unemployment is so low – and it’s not because Vermont is a hothouse of job growth. Quite the contrary, it’s due to a declining number of people participating in the workforce. More importantly, a low unemployment rate does not mean there is job growth, median household income growth, nor does it mean that state taxes revenues are growing (because they are declining.) If everyone in the state were employed at Wal-Mart, and unemployment was 0%, would the governor still be trumpeting the wondrous effects of his policies, or would there be a different reaction altogether? How about if all Vermonters worked in the fracking industry?
Speaking of altogether, let’s start repeating these facts, altogether now:
2. Ranked 44th for business climate.
4. 1st most costly state for manufacturing. (We’re number 1! We’re number 1!)
5. Gov’t is the highest component of Vermont’s GSP (scroll down to the Economy section).
6. Vermont was in the lowest quintile for state GSP growth for 2011.
7. Ranked 34th in per-capita GSP (2010).
8. From the period of 2001-2011, private nonfarm employment rose in total by 14,000 (342K to 356K – and Vermont’s population is roughly 620K, so half the population does not work). But the manufacturing sector lost 14,000 jobs, just in that sector. The health care/social assistance sector gained 12,00o jobs. These are not the trends that healthy, growing economies show.
But the VT Dept. of Labor has the more relevant data, data that Shumlin (shockingly!) failed to mention:
The Vermont seasonally adjusted unemployment rate decreased by three-tenths of a percent to 4.4 percent in February. The comparable rate for the United States (7.7 percent) was down two-tenths of a percent from the revised January estimate of 7.9 percent. The seasonally adjusted Vermont data for February show the Vermont civilian labor force decreased by 2,100 from the prior month estimates. The number of employed decreased by 1,000 and the number of unemployed decreased by 1,100. The over-the-month declines in the civilian labor force, the unemployment rate and the number of unemployed were statistically significant.
So – the civilian labor force decreased by 2,100 from the prior month. The number of employed and unemployed both decreased, by roughly 1,000, which is a wash. So the real reason why the unemployment number decreased was because 2,100 people left the labor force.
Note to Shumlin: That’s not a sign of a growing, vibrant, or even recovering economy. It’s yet another sign of a dying one.