The Burlington Free Press- Vt. Jobless Rate Highest in 15 Years
The state's unemployment rate spiked to its highest level in 15 years in September, and a leading Vermont economist said Tuesday the darkening economic picture will get worse before it gets better.
Figures released by the state Labor Department showed that the Vermont unemployment rate reached 5.2 percent in September, up from 4.9 percent a month earlier and up a full percentage point from January's 4.2 percent level.
The last time Vermont's seasonally adjusted unemployment rate topped 5 percent was in July 1993, when the figure stood at 5.1 percent.
"We're seeing the national economic slowdown impact us more than it has the last few months," said Patricia Moulton Powden, commissioner of the state Labor Department.
According to state figures, the largest employment drops occurred in the manufacturing, construction, retail and leisure/hospitality sectors. Employment was up slightly in the transportation and health care/social services sectors.
Art Wolff, a University of Vermont economics professor, said the newly released unemployment numbers indicate Vermont is entering its worst recession in 25 years. He said another 6,000 Vermonters could lose their jobs before things improve.
"This recession is going to be a real wake-up call for Vermonters," Wolff said. "I wouldn't be surprised if the unemployment number gets up to 6 percent in the next year."
Frank Cioffi, president of the Greater Burlington Industrial Corp., said he was not surprised by September's increase in the unemployment rate.
"A lot of companies are uncertain about the future," Cioffi said. "Those with their own financial resources are holding on to it right now and that's affecting spending on all levels. The No. 1 cost for an employer is labor, so hiring decisions are being put off."
Cioffi said Vermont is luckier than some bigger states because it has so many small businesses. He said Chittenden County was doing better than most of the rest of the state because it has a stronger economic base, but predicted the coming winter would be "challenging" for the region and the state.
"We're definitely in terrain we haven't been in for a very long time in this country," he said. "We're going to have to be very smart, very resourceful."
Duane Marsh, executive director of the Vermont Chamber of Commerce, agreed.
"Our employers are going to have to be real cautious and creative," he said. "We are going through a significant change in our economy."
Marsh said he believed the state has had a strong fall foliage season and, based on early season-ticket sales at Vermont ski areas, was optimistic about the prospects for the ski industry.
Republican Gov. Jim Douglas said the nation's financial services crisis was behind Vermont's economic downturn and said if re-elected he would push the Legislature to pass an economic growth plan he has proposed.
"We're definitely in for a bumpy ride," Douglas said. "We have to position ourselves the best we can to rebound from this as quickly as possible."
Democratic gubernatorial candidate Gaye Symington said the Douglas administration was partly to blame for the job decline in Vermont.
"What's happening in Vermont is not just about the national economy," she said in a statement. "Our rate of job creation over the past five years is less than half the national rate and the Federal Reserve says we have the slowest economy in New England."
Independent gubernatorial candidate Anthony Pollina said the impact of the job losses in Vermont represented "an additional failure of the Bush-Douglas policies."
"This is the kind of bad news that will ripple from kitchen tables to Main Street to the Statehouse," Pollina said. "People can't support local merchants or pay their taxes when they're out of work."
According to the state Labor Department's figures, unemployment rates in Vermont ranged from 3 percent in the Hartford area to 6.3 percent in Newport. A year ago, the statewide seasonally adjusted unemployment rate for September stood at 3.9 percent.