Editors' Note: In his column, "Is Vermont Really On the Job?" Doug Hoffer analyzes Vermont's economic development strategy. Got questions about Hoffer's stats? Here's where he got 'em.
1. Governor Douglas' State of the State: "As a result of our steadfast focus on economic growth, in the last five years, we've created 12,000 new jobs and our unemployment rate remains well below the national average." See http://governor.vermont.gov/speeches/state_of_the_state-1-10-08.pdf p.2
The Gov. was not referring to jobs but "employment", which includes self-employment. In addition, he used data from April 2003 to November 2007 - not "five years" (a little cherry picking). In fact, from the time he took office until November 2007 (latest data available when the speech was delivered), there were 9,700 more jobs (not 12,000) but only 7,500 net new private sector jobs. Since the context was economic development, it is misleading to include government jobs, which are not the focus of state job policy. And of course it would be odd for a conservative Republican governor to take credit for public sector jobs, especially when he's trying to eliminate 400 state jobs.
As for the unemployment rate, it's been below the national average for most of the last 30 years so it's tough to argue that the Governor's policies are in any way responsible.
2. State has spent $200 million on economic development: Two sources. First, Phase 9 of the Job Gap Study which estimated state & federal expenditures of ~ $40m per year.
See http://vtlivablewage.org/Phase%209.pdf pp.4-7.
Second, the Unified Economic Development Budget prepared by the Snelling Center for the Dept. of Finance & Management. See
http://finance.state.vt.us/Reports/Unified%20Economic%20Development%20Budget%202008.pdf pp.1-10. Note: The UEDB failed to include about $10 million in economic development expenditures.
3. State gained 7,000 private sector jobs from July `03 to Jan. `08: See VT Dept. of Labor, Current Employment Statistics; non-farm payroll, seasonally adjusted
4. U.S. rate of private sector job growth 6.9%: See
5. $200 million =$28,000 per net new job - it will take over 20 years to get this money back in taxes: Assumptions - new job pays $24,500; single, renter; estimated state tax revenue per year = $1,183. $28,000 ÷ $1,183 = 23.7 years. See JFO Tax Study Vol. 2 p.5 & 44
6. The number of people in Vermont ages 18 - 64 increased by 23,759 from 2000 to 2006: See
7. Almost half of all college students work: Bureau of Labor Statistics (CPS national data). See
8. Estimated number of part-time jobs in Vermont (65,000 - 70,000): VT Dept. of Labor. See
http://www.vtlmi.info/CPS_ftpt.htm (latest data available)
9. A growing percentage of those 65 and older continue to work: For both men and women ages 65 - 69, there has been a steady increase in labor force participation from the mid-`80s until today. See Federal Interagency Forum on Aging-Related Statistics
10. VT labor market grew by 7,100 from Jan. 2005 to Jan. 2006: VT Dept. of Labor. See
11. Comparison of median annual wage: Multiply median hourly wage times 2,080 hours (FT). See
12. Housing, energy prices, and taxes are all higher in NY and MA
Housing: HUD Fair Market Rents. See http://www.huduser.org/datasets/fmr/fmr2008f/FY2008_FMR_SCHEDULEB.pdf
Energy prices: U.S. Dept of Energy, EIA. See http://www.eia.doe.gov/cneaf/electricity/epa/epa_sprdshts.html
Taxes: JFO Tax Study, Vol. 2. See
13. "The Governor has been dissembling" - VT is not the highest taxed state in the country: The Governor refers to aggregated data published by the Right Wing Tax Foundation). That is, they look only at total taxes paid per capita (or as a % of total income). That tells us nothing about the distribution of the so-called "tax burden". The only fair way to compare taxes across states is to have an accountant fill out tax forms for people in different circumstances (age, family size, own or rent, etc.) and at various income levels. That is exactly what was done in JFO's Tax Study (Vol. 2).
The study found that because of Vermont's progressive graduated income tax, our "tax burden" is right in the middle of the pack (often much lower than others, especially for those earning less than $100,000). In addition, the Governor's concern about Vermont's high top marginal rate is misplaced because the top rate doesn't even apply until the first dollar earned over $349,700. This is very unusual because the top rate in most states kicks in at $20,000 - $40,000. This makes a huge difference in the effective tax rate (taxes paid as a % of income).
Finally, although the JFO Tax Study did not address property taxes, Vermont is unique for its income sensitive education tax so we would undoubtedly look even better if this tax had been included in the analysis.
14. Previous legislative requests for performance data: 32 V.S.A. §307(c) and 10 V.S.A. §7.
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